Taxes Consolidation Act 1997 section 711

Chargeable gains of life business

Section 711 adjusts the capital gains tax rules as they apply to chargeable gains accruing to funds maintained by a life assurance company in respect of its life business, ensuring that such gains are taxed at the standard rate of corporation tax.

• Gains accruing to life business funds are taxed at the standard rate of corporation tax, with no indexation relief permitted and no exemption for government securities
• The four-week "bed and breakfast" share identification rules apply to life business funds but are modified so that annual deemed disposals and reacquisitions are disregarded
• Where securities are bought cum-div and sold ex-div across accounting periods, any resulting capital loss is deferred to the period in which the related interest is received
• Net capital losses arising on special investment business or basic life assurance business disposals may be treated as management expenses, subject to the seven-year spreading rules under section 720