Further Increases to Insurance Premium Tax announced in recent Budget
In the recent Budget Chancellor George Osborne announced an increase of 0.5% in Insurance Premium Tax, which will now stand at 10% in total.
This follows on from a 3.5% increase in Insurance Premium Tax in November 2015 when the government increased the Tax from 6% to 9.5% and will mean that the Tax has risen two-thirds in around 6 months.
James Braund, specialist personal injury solicitor at Trethowans LLP’s Poole Office states that “Insurance Premium Tax is payable on all insurance policies, however it is often included not broken down in the quotations provided by insurance companies (particularly to consumers). One area where this decision will have a significant impact is in personal injury claims which are run by Conditional Fee Agreements with After the Event Insurance – particularly since such After the Event Insurance premiums (including Insurance Premium Tax) are now payable out of a Claimant’s damages.”