Finance Act, 1989

Amendment of section 60 (relief in respect of certain policies of insurance) or Finance Act, 1985.

84.Section 60 of the Finance Act, 1985 , is hereby amended by the insertion of the following subsection after subsection (1):

“(1A) In this section ‘insured’ means an individual or, in relation to a qualifying insurance policy where—

(a) the insured is an individual and the spouse of that individual at the date the policy is effected;

(b) annual premiums are paid by either or both of them during their joint lives, and by the survivor of them during the life of such survivor; and

(c) the proceeds of the policy are payable on the death of such survivor, or on the simultaneous deaths of both such spouses,

means—

(i) where the proceeds of the policy are so payable on the death of such survivor, that survivor, and the proceeds of the policy shall be deemed to have been provided by such survivor, as disponer; or

(ii) where the proceeds of the policy are so payable on the simultaneous deaths of both such spouses, each of the spouses, and each such spouse shall be deemed to have provided the proceeds of the policy—

(I) to the extent that such proceeds are applied in paying the relevant tax of the insured who is that spouse, and

(II) where the proceeds of the policy are not applied in paying relevant tax, to the extent that the proceeds not so applied are comprised in an inheritance taken under a disposition made by that spouse.”.