Insurance Premium Tax Increase from 6% to 9.5%

 

The government announced an increase to Insurance Premium Tax (IPT) earlier this year.

This change comes into effect from 1 November 2015 and will affect what you have to pay for your insurance.

 

Changes effective prior to 1 November 2015

For new business, renewals and mid-term changes, IPT will remain at the standard rate of 6%.

 

For changes effective on or after 1 November 2015

For new business and renewals the new standard rate of 9.5% will apply.

For mid-term changes where the policy renewed or was incepted on or after 1 November 2015, the new standard rate of 9.5% will apply.

For mid-term changes where the policy renewed or was incepted before 1 November 2015, insurers will charge either 6%, 9.5% or a combination of both.  This transitional period will last until the end of February 2016.

 

For changes effective on or after 1 March 2016

IPT on all premiums should be charged at the new standard rate of 9.5%, irrespective of the inception or renewal date of the policy.