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HMRC internal manual

General Insurance Manual

Repeal of equalisation reserves tax legislation for accounting periods ending on or after 1 January 2016: Election to accelerate receipts

A company can elect for the full amount of the reserve not yet brought into charge under FA12/S26(4) to be treated as a receipt for the year of election in any calendar year of the 6 year transitional period (FA12/S27).

The election is irrevocable and:

  • must be made by notice to an officer of Revenue and Customs
  • within 2 years from the end of the relevant year
  • cannot be made in the same calendar year as an election for a transfer of business (see GIM7450).


If there are different accounting periods falling in the year of election, the receipt is apportioned between those periods in the same way as described at GIM7410.