INSURANCE CODE
CHAPTER 226. UNAUTHORIZED AND INDEPENDENTLY PROCURED INSURANCE
PREMIUM TAX
SUBCHAPTER A. UNAUTHORIZED INSURANCE PREMIUM TAX
§ 226.001. DEFINITION. In this subchapter, "premium"
includes any consideration for insurance, including:
(1) a premium;
(2) a membership fee;
(3) an assessment; or
(4) dues.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
§ 226.002. APPLICABILITY OF SUBCHAPTER. This
subchapter applies to an unauthorized insurer who charges gross
premiums for insurance on a subject resident, located, or to be
performed in this state.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
§ 226.003. TAX IMPOSED; RATE. (a) A tax is imposed on
each unauthorized insurer that charges gross premiums subject to
taxation under this section. The rate of the tax is 4.85 percent of
the gross premiums charged by the unauthorized insurer.
(b) Except as otherwise provided by this section, in
determining an unauthorized insurer's taxable gross premiums, the
insurer shall include any premium for insurance on a subject
resident, located, or to be performed in this state.
(c) If a policy covers risks or exposures only partially
located in this state, the tax is computed on the portion of the
premium that is properly allocated to a risk or exposure located in
this state.
(d) In determining the amount of taxable premiums under
Subsection (c), a premium, other than a premium properly allocated
or apportioned and reported as a taxable premium of another state,
is considered to be written on property or risks located or resident
in this state if the premium:
(1) is written, procured, or received in this state;
or
(2) is for a policy negotiated in this state.
(e) Insurance on a subject resident, located, or to be
performed in this state is considered to be insurance procured,
continued, or renewed in this state regardless of the location from
which:
(1) the application is made;
(2) the negotiations are conducted; or
(3) the premiums are remitted.
(f) Premiums on risks or exposures that are properly
allocated to federal waters or international waters or are under
the jurisdiction of a foreign government are not taxable by this
state.
(g) The following premiums are not subject to the tax
imposed by this subchapter:
(1) premiums on insurance procured by a licensed
surplus lines agent from an eligible surplus lines insurer as
defined by Chapter 981 on which premium tax is paid in accordance
with Chapter 225; and
(2) premiums on an independently procured contract of
insurance on which premium tax is paid in accordance with
Subchapter B.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
§ 226.004. TAX EXCLUSIVE. The tax imposed by this
subchapter is in lieu of all other insurance taxes.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
§ 226.005. TAX PAYMENT; DUE DATE. (a) The tax imposed
by this subchapter is due and payable not later than:
(1) March 1 after the end of the calendar year in which
the insurance was effectuated, continued, or renewed; or
(2) another date prescribed by the comptroller.
(b) An unauthorized insurer shall pay the tax imposed by
this subchapter using a form prescribed by the comptroller.
(c) If an unauthorized insurer defaults in payment of the
tax imposed by this subchapter, the insured is responsible for
paying the tax.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
SUBCHAPTER B. INDEPENDENTLY PROCURED INSURANCE PREMIUM TAX
§ 226.051. DEFINITION. In this subchapter, "premium"
includes any consideration for insurance, including:
(1) a premium;
(2) a membership fee; or
(3) dues.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
§ 226.052. APPLICABILITY OF SUBCHAPTER. This
subchapter applies to an insured who procures an insurance contract
in accordance with Section 101.053(b)(4).
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
§ 226.053. TAX IMPOSED; RATE. (a) A tax is imposed on
each insured at the rate of 4.85 percent of the premium paid for the
insurance contract procured in accordance with Section
101.053(b)(4).
(b) If an insurance contract covers risks or exposures only
partially located in this state, the tax is computed on the portion
of the premium that is properly allocated to a risk or exposure
located in this state.
(c) Premiums for individual life or individual disability
insurance are not included in determining an insured's taxable
premiums.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
§ 226.054. TAX PAYMENT BY CERTAIN
INSUREDS. (a) Except as provided by Section 226.055, the tax
imposed by this subchapter is due and payable not later than:
(1) May 15 after the end of the calendar year in which
the insurance was procured, continued, or renewed; or
(2) another date prescribed by the comptroller.
(b) An insured who fails to withhold from the premium the
amount of tax imposed by this subchapter is liable for the amount of
the tax and shall pay the tax due.
(c) The insured shall file a tax report and pay the tax.
(d) The insured may designate another person to file the
report and pay the tax.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
§ 226.055. TAX PAYMENT BY CERTAIN CORPORATIONS. The
amount of tax due and payable under this subchapter by a corporation
that files a franchise tax report shall be reported directly to the
comptroller and is due:
(1) at the time the franchise tax report is due; or
(2) on another date prescribed by the comptroller.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
§ 226.056. EFFECT ON OTHER LAW. Sections
226.051-226.054 do not abrogate or modify any other provision of
this chapter or Chapter 101.
Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.
