Transfers of business between mutual societies
The measure
Under current legislation different taxation consequences can arise depending upon whether a transfer of business is to a mutual society or to a company, and depending upon the type of mutual society involved.
Finance Bill 2009 will introduce a power to make regulations to ensure that where possible equivalent taxation treatment applies, and to provide certainty where the current rules are unclear. The changes could affect mutual insurers and friendly societies looking to rationalise or to merge with other bodies.
Who will be affected?
Building societies, industrial and provident societies and friendly societies.
When?
Regulations made under this power will have effect for transfers of business taking place on or after 22 April 2009.
The Budget Notes do not indicate any surprises versus what had been expected based upon previous discussions with HMRC.
