HMRC called on to say brokers need not fear bonus super tax

Accountacy firm Mazars has asked the government to clarify that the new super tax on bonuses for bankers will not apply to the insurance industry.

Although the rules exclude insurance companies, the legislation bases its definition of a bank on types of activity that must be authorised by the FSA, and which could potentially catch activities unconnected with banking, such as those by insurance brokers and intermediaries.

There is also a risk for Lloyd's managing agents, as they conclude insurance contracts as agent on behalf of syndicate members.

Mazars’ head of financial services tax, Howard Jones, said: “We do not think that it is the intention of HMRC to discourage insurance brokers, intermediaries and managing agents from rewarding staff compared to those of the actual underwriters. We have made representations to HMRC to indicate where amendments are required, and hope that it will be resolved in time to allow clients with an accounting year coming to an end to make informed decisions about their discretionary bonuses.”