Official: bank bonus tax to exclude insurance companies

by Gill Montia

Story link: Official: bank bonus tax to exclude insurance companies

HM Revenue & Customs has confirmed that the bank payroll tax (better known as the bank bonus tax) announced in the pre-Budget report does not apply to insurance companies, asset managers and stockbrokers.

Concerns had been raised over the definition of a “bank” as used in the draft legislation and HMRC has concluded “that the original definition of a ‘bank’ did not effectively exclude all the groups we intended to exclude”.

The draft legislation is therefore being amended to exclude stock brokers and insurance companies.

In related news, Barclays’ chief executive, John Varley, has been speaking out about the bonus tax in an interview with the BBC.

He claims that the temporary levy of 50% on individual discretionary bonuses of over £25,000 will damage the City and has criticised the Government for not ensuring a “predictable tax environment” in the UK.