How Multinationals Can Navigate Income Taxes on Paid Insurance Claims

Increasingly, multinational companies have faced scrutiny from local tax authorities for unpaid insurance premium-related taxes, such as those in Canada, the US, Switzerland, and certain EU member states. While premium-related taxes (on average, 10% of total premiums) cannot be ignored, among the most significant hidden costs facing multinationals is potential corporate income tax liability (on average 25%) on paid insurance claims.

Yet such potential costs are frequently ignored during insurance renewals and placements. This Advisor, from Marsh’s Regulatory and Tax Consulting Practice:

• Explores potential corporate income tax risk for multinationals.
• Provides a case study in which a multinational had a corporate income tax liability of EUR2.5 million on a EUR10 million claim paid by the insurer.
• Covers steps multinationals can take to avoid unnecessary taxes on paid insurance claims.

Read or download the Advisor for full details.