Duty is charged on General Insurance and Life Insurance.
Duty payable is a percentage of:
- the premium paid in relation to contracts of General insurance,
- the sum insured by a Life insurance policy,
- the first years premium of a Temporary or Term insurance policy, and
- the premium paid on a Mortgage insurance policy
Duty on an Annuity is $50, if it complies with subsection 174(6) Duties Act 2001.
The Insurance Duty Calculator has duty rates and can estimate your liability.
Responsibility to pay
The liability to pay duty rests with the 'insurer', if they are required to be registered.
Otherwise, the insured person is liable to pay the duty.
In most cases the insurance company or broker will arrange payment of duty. However, responsibility lies with the insured person to confirm this is the case.
If neither the insurer nor the broker pays the duty, the insured person must pay the insurance duty and lodge a one-off return using Tasmanian Revenue Online.
All 'insurers' that cover a risk must apply to be registered. Brokers and other insurance intermediaries may register to pay duty on behalf or their clients.
Register using Tasmanian Revenue Online
Making One-off Returns
If the insurer or broker doesn't pay the duty associated with an insurance policy, the insured person is required to lodge a one-off return and pay the duty. This can be done using Tasmanian Revenue Online.
Returns must be lodged and paid by the 21st day of the month for premiums paid, or for life insurance policies effected, in the preceding month.
In most cases, duty is imposed on the 'insurer' because they are liable to pay the duty. In practice, an insurer would usually pass this cost onto their clients as part of the cost of providing the insurance.
This means that even if you or your organisation is usually exempt from Australian taxes (e.g. charities, public benevolent institutions and similar) you will still be charged the cost of the duty by the insurer. An insurer would normally determine if the type of insurance provided qualifies for one of the exemptions provided by section 190 of the Duties Act.
Public liability insurance
Effective 1 July 2002, an exemption applies to:
- insurance effected by a separate policy in a distinct sum against a claim for public liability; and
- insurance in a distinct sum against a claim for public liability included in a package of insurance other than in a domestic policy covering home or contents or both home and contents.
Other exemptions are specified in section 190 of the Duties Act 2001.