The commentary below considers the exposure of friendly societies to tax on chargeable gains. For an overview of the taxation of chargeable gains generally, see C1.101.
There is no statutory definition of a 'friendly society'. The general concept of a friendly society is that the membership contributes to a fund to be used for the welfare of the members or for their assistance when in need or distress. In this way, friendly societies are mutual associations for the purposes of insurance and annuities.1
Friendly societies, whether registered or unregistered, incorporated or unincorporated, are treated as companies under the definition of 'company' in CTA 2010, s 1121 (see C1.208)2. Therefore, if friendly societies are liable to tax on chargeable gains, they are liable to corporation tax3.
For a full discussion of friendly societies, see Division D7.4.
Unregistered friendly societies
An unregistered friendly society is one that is not registered, calls itself a friendly society and provides welfare for its members4.
An unregistered and unincorporated friendly society
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