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Taxation Determination

TD 92/120

Income tax: insurance: if income tax returns for years before the income year commencing 1 July 1991 are amended to include as assessable income the earned portion of unclosed business, is the basis of calculation of the unearned premium provision (UPP) required to be made using the 365th method as discussed in Taxation Ruling IT 2663?

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FOI status:

may be releasedFOI number: I 1212885

This Determination, to the extent that it is capable of being a 'public ruling' in terms of Part IVAAA of the Taxation Administration Act 1953, is a public ruling for the purposes of that Part. Taxation Ruling TR 92/1 explains when a Determination is a public ruling and how it is binding on the Commissioner. Unless otherwise stated, the Determination applies to transactions entered into both before and after its date of issue.

1. No. If amendments to prior year returns are made to include unclosed business, the method originally adopted in those years for calculating the UPP may be maintained if that method was in accordance with Ruling IT 79 or a private ruling given by the ATO.

2. Paragraph 140 of Ruling.IT 2663 does not require a change to the 365th method until the income year commencing 1 July 1991 or substituted accounting period in lieu. However, if requested by a taxpayer, the 365th method as discussed in paragraphs 42 to 44 of the Ruling may be applied to those prior years amended.

Commissioner of Taxation
16 July 1992

References

ATO references:
NO Insurance Industry Cell

ISSN 1038 - 3158

Related Rulings/Determinations:

TD 92/119
IT 79
IT 2663

Subject References:
general insurance companies
unclosed business
unearned premium provision

Legislative References:
ITAA 25(1)

TD 92/120 history
  Date: Version: Change:
You are here 16 July 1992 Original ruling  
  25 February 1998 Withdrawn  

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