You may recall our article in December about the Government’s Autumn Statement and the rise in IPT (Insurance Premium Tax).
Well, it comes into force on 1st June, so here’s a reminder about how it will affect yours and your customers’ premiums.
What is IPT? is the tax we have been paying to the Government since 1994 on policies for cars, homes and things like private medical care.
When it first came into force it was 2.5% and over the years it has risen to 10% of an insurance premium, but, from next week, it will be 12% for most drivers.
There is an even higher 20% rate when insurance is sold with goods and services, including car purchases.
How much will you have to pay?
The tax will apply to your total insurance premium, so 12% (instead of 10%) of that figure. If you’re policy is £500, you’ll currently be paying £550, but from June it will be £560.
Whilst it is still one of the lowest rates of its kind across Europe, it will cost you that little bit extra, with the 12% obviously becoming a higher figure if your premiums are more expensive.
What drivers will it affect?
Young drivers and especially those in London are expected to be hit the hardest by the rise in this tax, as premiums for these people are higher anyway.
Will it affect my Tradesure policy?
Unfortunately, when taxes go up it affects everybody, but if you’re a Tradesure customer or considering taking out a policy with us, we will continue to strive to find the best policies at the best prices.
Our customer service remains second-to-none and we pride ourselves on not only the most competitive prices, but one-to-one account managers who are always on hand to help you with you requirements.
Call us today on 0121 248 9300 for all your motor trade insurance needs.