The Blue Badge regulations will be amended from 30th August 2019, in England, for those with a hidden disability which limits their ability to walk safely. The Blue Badge regulations will be amended from 30th August 2019, in England, for those with a hidden disability which limits their ability to walk safely. Blue Badge holders are able to park closer to their destination, either as the driver or passenger, in disabled parking bays, usually for free on streets with parking meters or pay-and-display machines, and on single or double yellow lines for up to 3 hours in certain circumstances. The eligibility criteria for a Blue Badge has been extended beyond those with a physical disability to now include those who: • cannot undertake a journey without there being a risk of serious harm to their health or safety or that of any other person; • cannot undertake a journey without it causing them very considerable psychological distress; • have very considerable difficulty when walking (both the physical act and experience of walking); and • scored 10 points under the 'planning and following journeys' activity of Personal Independence Payment (PIP) by virtue of being unable to undertake any journey because it would cause overwhelming psychological distress to them. This will lead to automatic entitlement in much the same way as scoring 8 points under the ‘moving around’ activity of PIP which is already in place. The regulations also amend the current requirement that the disability be 'permanent and substantial', changing it to 'enduring and substantial'. Those who do not meet the automatic eligibility criteria linked to PIP awards, can still apply and go through the standard assessment process. Under the new regulations, ‘expert assessors’ with specialist experience of non-physical impairments, can be appointed by the local authority to undertake the assessment to determine eligibility.
Outcome of an HMRC consultation on part surrenders and part assignments of life insurance policies.Apr 7th, 2017
In May 2006, Mr Lobler invested $1.4m (£930,000) in an offshore life bond which consisted of 100 segments. Half the funds invested derived from savings and the sale proceeds of the family home, the remaining half was borrowed. He made two large withdrawals within two years of making the investment. Unfortunately, Mr Lobler on both occasions he chose the option on the withdrawals forms to make partial withdrawals across all the policy segments rather than to encash individual policy segments. The outcome of this was that he was taxed on an artificial gain based on the amount withdrawn less the annual allowance of 5% of the premiums originally paid, rather than the actual gain on the amounts withdrawn.
Mr Lobler appealed against the HMRC decision, but although he had the sympathy of the First Tier Tax Tribunal, his appeal was dismissed. In his judgment, Judge Charles Hellier acknowledged that it was “an outrageously unfair result” but HMRC was acting in accordance with the rules. On appeal the Upper Tax Tribunal allowed Mr Lobler rectification putting him in the tax position he should have been in if he had encashed full segments and so taxed on the actual gain on the funds withdrawn. What was also significant was the Upper Tax Tribunals severe criticism of the chargeable event tax legislation which led to the Government in April 2016 launching a consultation on proposals to change the current rules. The government suggested three possible options:
- A 100% allowance – no gain would arise until all of the premiums paid has been withdrawn.
- Taxing the economic gain – the current 5% tax deferred allowance would remain but if a greater sum was taken a proportionate fraction of any economic gain would come into charge.
- Deferral of excessive gain – maintain the current method of calculating the gain but the amount of gain that could be brought into charge on a part surrender would be limited to a predetermined amount of the premium. Any deferred gains would be brought into charge on full surrender.
HMRC has now published its response to the consultation. The 100% allowance option, being the most generous and simple to understand, was the most favoured by respondents. However, HMRC has decided not to go for any of the three but has come up with an alternative option.
In future, any policyholder who finds they have generated a totally disproportionate gain can simply apply to have the gain recalculated on a just and reasonable basis. Applications will be required in writing and received by an officer of HMRC within two years after the end of the insurance year in which the gain arose.
Please note that PFP are not taxation advisers, and independent taxation advice should be sought prior to acting on any information given.