taxud/2414/08 - European Commission - Europa

Capital Redemption Bonds are deposits of money in an account. They consist of one or
more fixed sums paid under a contract pursuant to which one or more specified amounts
are paid out at some later time or times, on the basis of an actuarial calculation, Typically
the contracts take the form of an annuity certain, where a capital sum is used to buy an
annuity for a fixed term not contingent on life, or a sinking fund where regular sums are
paid in to secure a capital sum at some later date, for example against the need to find a
premium payment to renew a lease;
(h) insured pensions and annuities where the mortality or longevity risk covered is
merely ancillary.
Insured pensions with ancillary mortality or longevity risk being covered are deposits of
money in an account. Such cases premiums are received to provide a capital sum to pay a
pension. In most cases on maturity a certain percentage of the fund can be taken as a
lump sum and the remainder invested in an annuity. In some cases it is possible to defer
the annuity and in some special cases alternatives to an annuity can be used. Insured
pensions without mortality or longevity risk are therefore deposits of money;
Annuities with ancillary mortality or longevity risk are payments made under a legal
obligation and are “pure income profit”. They can be characterised as “annual”, so being
capable of recurrence on a periodic basis by reference to an annual time frame. Although
the purchase sum passes absolutely to the provider of the annuity and no debtor/creditor
relationship is created in relation to that sum, it is replaced by the annuity. The
annuitant’s right is to demand payments when due and represents the way in which the
annuitant retains rights to his deposit. Annuities used for pensions are commonly called a
purchased life annuity. The payments for the annuity are not instalments of pre-existing
debt.
2. The definition of "financial deposit" provided for in point (4) of Article 135a of
Directive 2006/112/EC shall not cover the following:
(a)
the deposit for safekeeping of collectors' items or of instruments evidencing
rights, claims or titles;
Such services are safe-keeping services and do not involve the depositing of money;
(b) hiring of security boxes and securitised space and location.
These are services which do not involve the deposit of money in an account and are
comparable to the hire of safes, which is a service excluded from the exemption under
point (d) in Article 135 paragraph 2. of the Directive.
(ff) account operation
Under Article 135a (5) of Directive 2006/112/EC "account operation" means the
operation of a monetary account for a customer. This provision is complemented by
Article 6 of the Regulation which provides for the following:
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