For accounting periods beginning before 1 January 2023, relief for acquisition expenses incurred in an accounting period is given in seven equal instalments in that period and the ensuing six accounting periods (see D7.459). For accounting periods beginning on or after 1 January 2023, insurance companies must adopt IFRS 17 and the treatment of acquisition costs will follow the accounts. This will result in certain amounts becoming subject to corporation tax and so regulations set out a transitional regime to spread these over a 10-year period1.
When an insurance company which carries on long-term business adopts IFRS 17, the company must determine the transition amount. This is the difference between relevant amount shown as a closing balance in the first IFRS 17 balance
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