S
SABeauty
Member
Part ii. It says the results of being taxed on a gross I - E basis would be higher investment return?
Can someone explain this.
In the notes when it explains the I - E and the components in I it says investment income from real estate, gilts and bonds. Is this the net investment income or gross income? How does the tax normally work?
Also in this question - it says the gross investment income can be passed to the policyholder tax free. But the company still pays tax on it so there is a mismatch there. How would the company allow for that tax in the pricing?
Can someone explain this.
In the notes when it explains the I - E and the components in I it says investment income from real estate, gilts and bonds. Is this the net investment income or gross income? How does the tax normally work?
Also in this question - it says the gross investment income can be passed to the policyholder tax free. But the company still pays tax on it so there is a mismatch there. How would the company allow for that tax in the pricing?