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NU brings Indian call staff in-house

Norwich Union is bringing its 1,000 Indian call-centre staff in-house in a move that will enable it to bypass a potential tax charge.

The move follows a European Court of Justice ruling that raises the likelihood that UK life offices will have to pay a 17.5 VAT charge, from which they were previously exempt, on non-sales outsourced services.

HM Customs & Excise is set to launch a consultation after this week’s general election.

NU announced the outsourcing of around 1,000 jobs in its back-office and servicing departments last September. It planned to raise this figure to 7,500 at a cost saving of 40 per cent compared with an equivalent UK operation.

Although the Indian call-centre staff will be NU employees, they will face a huge pay discrepancy compared with their UK counterparts.

UK chief executive Gary Withers says: “We have not fully explored the tax implications of this but it will motivate us to transfer the operation in-house as quick as is sensibly possible.”

ABI taxation manager Lee Francis says: “We are discussing this with HM Customs & Excise and they will consult on it after the election.”


Out of context

“I am Standard life through and through. If you cut my arm off, it would say Standard Life and I want that same commitment from the directors.” – A passionate Standard Life policyholder at the firm’s AGM.

The starting grid

In this article, I will conclude my discussion of some of the main factors which might determine the advisability or otherwise of effecting a transfer from a final-salary pension scheme.

Bond appetit

The collapse of the with-profits market in the UK is no secret and figures published recently by the ABI show how dramatic the shift away from WP business has been.


Case study: administration — managing group life schemes

Our client leads the global market in high-tech electronics manufacturing and digital media. The trustees of the company’s final salary pension scheme insure death-in-service lump sum and dependants’ pension death benefits for active employees, as well as dependants’ pension benefits for deferred members (those who have left service).


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