Corporation Tax Act 2009 section 1127

Qualifying expenditure on externally provided workers

Section 1127 defines what counts as expenditure on externally provided workers for the purposes of R&D tax relief and explains how qualifying expenditure is determined.

• A company incurs expenditure on externally provided workers when it makes a "staff provision payment" to a "staff provider" for the supply of workers' services.
• The qualifying amount of that expenditure is calculated under section 1129 (where the company and the staff provider are connected persons) or section 1131 (in all other cases).
• Sections 1128 to 1131 provide further detail on the definition of an externally provided worker and the calculation of qualifying expenditure.
• The relief for externally provided workers applies only to expenditure incurred on or after 9 April 2003 (for SME and vaccine research relief) or 27 September 2003 (for large company, SME subcontractor, and Northern Ireland relief schemes).