In this year’s March Budget, the Chancellor of the Exchequer announced Insurance Premium Tax (IPT) would rise from 9.5% to 10% from 1 October.

There will be a concessionary period that will begin on 1 October 2016 and end on 31 January 2017.

During this period, mid-term adjustments for policies with term start dates before 1 October 2016 will continue to be liable to IPT at 9.5% provided the premium is booked in insurers systems by 31 January 2017.

For policies incepted or renewed prior to 1 October 2016 where the transaction date is prior to 1 October 2016 the IPT rate applicable for new business, renewals, mid-term changes (additional/return premiums) will be 9.5%.

For policies incepted or renewed on or after 1 October 2016 the IPT rate for new business, renewals, mid-term changes (additional/return premium) will be 10%.

For policies incepted or renewed prior to 1 October 2016 where the transaction date is on or after 1 October 2016 the IPT rate applicable for new business, renewals, and mid-term changes and cancellations where there is a return premium will be 9.5%.

For mid-term changes where there is an additional premium the IPT rate applicable will be 10%.