Insurance Premium Tax
Insurance Premium Tax is the tax on different insurance premiums. It is also called as IPT. This insurance tax is belonged to the insurers and insurance companies all these taxes about Insurance Premium. Insurance Premium Tax is the tax which is calculated as the amount on the receivable payment in any insurance policy. The value of tax varies from country to country. The law about Insurance Premium Tax was established in 1994. This act which is called as Insurance Premium Tax Regulations, gives more details about the tax on insurance policies. There are two different rates about Insurance Premium Tax. The standard rate of Tax is 2% of the total rate, while the higher rate of insurance tax is 20%. Insurance companies which provides taxable insurance have required to register for IPT from the insured. Companies who have high rate of Insurance Premium Tax, get this on their self. Initially the rate which was fixed for Tax was 2.5 percent for every category and this was started charging from 1994. Then in 1997 the rates were changed. The standard rate were selected to charge 4 percent as a standard rate which was update in 199 to 5 percent and then 6 percent in 2011. While the higher rate was 17.5 percent in 1997. Then in 2011 the rate rose to 20 percent. Mostly short term insurances have include to pay the premium tax, while short term insurance policies are exempted from Tax, like life insurance, property insurance and other long-term insurances. But in some countries there is 2 percent tax on life insurance. This insurance tax doesn’t affect the policy holder and mostly companies don’t raise their rates for their insurance polices and pay taxes on their own. It indicates that which company pays the most taxes in a year, that refers the company as more successful. Which company pays more taxes have the happiest clients and will be better and beneficial for an insured.