Corporation Tax Act 2009 section 1051

Qualifying Chapter 2 expenditure

Section 1051 defines what counts as "qualifying Chapter 2 expenditure" for the purposes of the SME research and development relief scheme.

  • A company's qualifying Chapter 2 expenditure is the total of its expenditure that qualifies under three specific categories
  • The first category covers expenditure on in-house direct research and development carried out by the company itself
  • The second category covers expenditure on research and development that the company contracts out to others
  • A third category of qualifying expenditure was added by Finance Act 2024

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