Insurance Premium Tax

Insurance Premium Tax (IPT) is a tax imposed by HM Government on insurance contracts but IPT does not apply to risks that are situated in the Channel Islands or the Isle of Man.

History of IPT

IPT was introduced for insurance contracts in 1994.

• 1st January 1994 - 2.5%
• 1st April 1997 -  4%
• 1st April 1999 -  5%
• 4th January 2011 -  6%
• 1st November 2015 - 9.5%
• 1st October 2016 - 10%
• 1st June 2017 -  12%

A higher rate of 20% IPT applies to selected goods and services e.g. travel insurance.

All contracts of insurance are liable for IPT unless they are specifically exempted e.g. reinsurance.