Around 7000 Eurolife High Income Bond policyholders can look forward to a refund of around £700 each from the company.
The refunds will be made following a ten month battle between Eurolife and the Inland Revenue on tax liabilities for high income bonds. When the Inland Revenue proposed the additional tax liability, most providers of these bonds opted to bear the tax themselves. Eurolife did not and chose to withhold around 4.75% of each investors original capital until the rules were finalised in November 2001. The Inland Revenue's proposals were rejected and they chose not to appeal.
However, the Inland Revenue have said that they will make further investigations. Eurolife have agreed to fund any tax liability resulting from the further investigations themselves.