Section EZ 53 — Income Tax Act 2007: How expected death strain is calculated

EZ 53 How expected death strain is calculated Calculation of expected death strain: steps (1) For an income year, the life insurer calculates their expected death strain by following these steps: (a) first, use the relevant expected death strain formula to calculate an amount for each life insured under each life insurance policy existing at the start of the income year ( see: subsections (2) and (3) for guidance on the relevant expected death strain formula): (b) second, for each such life insurance policy, add together the amounts for the lives insured under it: (c) third, add together the totals reached under paragraph (b). Expected death strain formula (life) (2) Section EZ 54(1) sets out the expected death strain formula (life). This is the formula a life insurer uses for an income year, to calculate an amount for a life insured under a life insurance policy, except to the extent to which an annuity is being paid under the policy at some time in the income year. Expected death strain formula (active annuities) (3) Section EZ 54(2) sets out the expected death strain formula (active annuities). This is the formula a life insurer uses for an income year, to calculate an amount for a life insured under a life insurance policy, to the extent to which an annuity is being paid under the policy at some time in the income year. Defined in this Act: business , income year , life insurance , life insurance policy , life insured , life insurer , pay Section EZ 53: inserted, on 1 July 2010, by section 199(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).