taxes

Insurance Premium Tax (Licensed Captive Insurers)

Who is responsible for this tax?

Captive insurers licensed in Texas may only insure the operational risks of affiliates and the risks of a controlled unaffiliated business. Premium tax is due on the entire premium these captives receive regardless of the location of the risk.

Single-parent captive insurers may apply for a certificate of authority from the Texas Department of Insurance in order to operate in Texas. An authorized foreign or alien captive that is licensed under the laws of another jurisdiction may redomesticate to Texas with Commissioner of Insurance approval.

Rates

Licensed captive insurers pay a premium tax rate of .5 percent, with a minimum premium tax due of $7,500 and a maximum premium tax due of $200,000.

Due Date

  • Yearly: March 1 following the end of the calendar year (for example, March 1, 2015, for premiums received in 2014).
  • Semi-annual prepayments: March 1 and August 1 of each year.

Penalties and Interest

Penalties
  • If tax is paid 1-30 days after the due date, a 5 percent penalty is assessed.
  • If tax is paid over 30 days after the due date, a 10 percent penalty is assessed.
Interest

Reporting and Payment Requirements

Select the amount of taxes you paid in the preceding state fiscal year (Sept. 1 – Aug. 31) to find the reporting and payment methods to use.

Less than $10,000

Select one of these reporting methods:

Select one of these payment methods:

  • Web Electronic Funds Transfer (EFT) or credit card via Webfile (American Express, Discover and MasterCard)
  • TEXNET
  • Check
$10,000 - $49,999

Select one of these reporting methods:

Select one of these payment methods:

  • Web Electronic Funds Transfer (EFT) or credit card via Webfile (American Express, Discover and MasterCard)
  • TEXNET
$50,000 - $99,999

Webfile is the only acceptable reporting method.

Select one of these payment methods:

  • Web Electronic Funds Transfer (EFT) or credit card via Webfile (American Express, Discover and MasterCard)
  • TEXNET
$100,000 or more

Webfile is the only acceptable reporting method.

TEXNET is the only acceptable payment method.

Additional Resources