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HMRC internal manual

General Insurance Manual

HM Revenue & Customs
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Repeal of equalisation reserves tax legislation for accounting periods ending on or after 1 January 2016: Transfer of whole or part of the business during the transitional period

An insurance company may transfer all or part of its business to another company under an insurance business transfer scheme (i.e. a transfer under Part VII of the Financial Services and Markets Act 2000), see GIM4220.

If receipts arise to an insurance company under FA12/S26(6) because that company has ceased to carry on business (see GIM7420) the transferor and transferee can make a joint election to allocate the receipts between them (FA12/S29). This allows the transitional period to continue to run for the transferee.

For all transfers of business the election is irrevocable and must be

  • made by notice to an officer of Revenue and Customs
  • made within 28 days from the end of the day on which the transfer takes place
  • be accompanied by an explanation of how the amounts have been apportioned.


Apportionment of the receipt between the transferor and transferee is on a time basis.