We are circulating this article to advise the Lloyd's market that Lloyd’s Europe and Lloyd’s syndicates Italian premium tax advance payment will be made to the Italian tax authority on 7 November 2023.
Background
The advance payment of Italian premium tax is paid to the Italian tax authority on an annual basis and is a legal requirement for all insurers writing taxable risks in Italy. All Lloyd’s Italian business is written by Lloyd’s Europe; however, a small amount of business written by Lloyd’s syndicates can still be subject to Italian premium tax due to the way the Italian premium tax rules work . The advance payment prepays part of the following year’s tax liability of the insurer, which is then offset or refunded against actual tax liabilities arising that year.
Calculation Method
The advance payment will be collected from syndicates and is calculated as 100% of the Italian premium tax paid in the previous year. In the case of the 2024 advance payment, this calculation is based on the premium tax paid by Lloyd’s Europe and Lloyd’s syndicates in the 2022 calendar year.
Run-off Syndicates
Syndicates in run-off are not exempt from this obligation. If a syndicate received taxable Italian premium during the 2022 calendar year, it may still be liable for the prepayment of Italian premium tax.
For further clarifications and guidance on the application of the Italian premium tax advance payment, please contact Lloyd’s Tax Department.
taxdept@lloyds.com