Insurance Premium Tax (IPT)

Insurance Premium Tax (IPT) is a specialist area of indirect taxation applied to most general insurance premiums in the UK. With two current rates, 12% for standard policies and 20% for certain insurance products, correctly determining the applicable rate can be complex, particularly where a policy includes multiple elements or cross-border considerations.

Hammad offers clear and detailed guidance to help insurers, brokers, and businesses understand their IPT obligations and structure policies in a compliant and efficient way.

IPT legislation contains a wide range of exemptions, and navigating these can be challenging without specialist insight. Determining whether a policy, or a component of a policy, qualifies for exemption is critical in avoiding costly assessments or compliance issues.

Hammad assists clients in interpreting the rules, assessing liability, and ensuring accurate treatment across varied insurance offerings.

A number of insurance products may be fully exempt from IPT, including:

• Life insurance
• Mortgage insurance
• Commercial ships and aircraft
• International railway rolling stock
• Lifeboats and associated lifeboat equipment
• Goods in international transit

Hammad provides tailored advice for insurers and businesses seeking clarity on exemption eligibility, premium structuring, mixed-policy analysis, and dispute resolution where HMRC challenges arise. His expertise helps clients manage IPT risk effectively while maintaining compliance with UK tax regulations.

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