Introduction Background
128.The qualifying policy (QP) regime was introduced in 1968 to preserve pre-existing tax treatment for traditional moderate value, long term, regular premium savings policies that contain a significant element of life insurance.
129.No upper limit was set for the investment premiums that could be paid into a QP which allowed individuals to obtain unlimited relief from higher rates of income tax.
130.The Government announced in Budget 2012 a restriction to the tax relief available for QPs. This restriction will limit the amount of premiums payable into QPs for an individual to no more than £3,600 in any 12 month period with effect from 6 April 2013.
131.This Schedule introduces changes to legislation, following consultation, which implements the new annual premium limit of £3,600.
132.Policies issued before 21 March 2012 will only be affected by the new rules where there is substitution, variation or the exercise of an existing option within the policy on or after 21 March 2012 which results in the following: