Corporation Tax: response to accounting changes for insurance contracts

The government announced at Autumn Budget 2021 that, for tax purposes, it will spread the transitional impact of IFRS 17 and revoke the requirement for life insurance companies to spread acquisition expenses over 7 years. This consultation will inform the design of the necessary legislation.

This consultation will be of interest to:

• all life insurers and general insurers who report under International Accounting Standards (IAS)
• any non-insurers who report under IAS and who will be affected by IFRS 17 because they issue contracts which meet the IFRS 17 definition of an insurance contract
• all life insurance companies that write Basic Life Assurance and General Annuity Business (BLAGAB) and are required to spread acquisition expenses over 7 years for tax purposes under section 79 of Finance Act 2012