Canadian insurers should consider the tax effect of significant changes under a new accounting standard that is scheduled to become effective in 2023. This standard, known as IFRS 17, defers recognition of a portion of insurance revenues into profits, which is currently included in income when insurance contracts are sold. Finance released long-awaited guidance and proposed tax measures in its 2022 federal budget to address how insurance businesses will have to calculate profits for Canadian tax purposes under the new international standard. Insurers may want to follow the latest news on these upcoming changes, which are set to go into effect January 1, 2023, including any forthcoming clarifications on certain aspects of the rules.

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