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For accounting periods beginning before 1 January 2023, acquisition expenses attributable to a company's BLAGAB were not wholly relievable in the period in which they were incurred but had to be spread forward and relieved as management expenses over a seven year period. Although acquisition expenses will be spread in the company's statutory accounts, the deferral for tax purposes was not calculated by reference to the entries in the accounts. Despite the changes to the tax regime for insurance companies tying the tax computation more closely to the accounts, the government chose not to address the mismatch between the accounting and tax regimes until January 2023.

The historic reason for this policy was to remove in very broad terms the mismatch between income and expenditure resulting from the high degree of front-end loading of expenses to BLAGAB policies. Following the removal of protection business from the I-E regime with effect from 1 January 2013 and the introduction of the FSA's Retail Distribution Review (which effectively banned commission) in December 2012 it is likely that the measure