Assignments of life policies and taxation

Chris O'Neill looks at the tax consequences of assignments of life policies and the tax planning opportunities the rules offer

An assignment is a transfer of legal ownership from one party to another. Common types of assignment include assignments by way of gift, assignments by way of mortgage and assignments into (or out of) trust. Here we look at the tax consequences of assignments of life policies and the tax planning opportunities that the rules offer. Full assignments For non-qualifying policies, such as investment bonds, a full assignment is only a chargeable event for income tax purposes if it is for money or money's worth. Furthermore, assignments by way of mortgage and assignments between spouses livin...