Corporation Tax Act 2009 section 1138

"Subsidised expenditure"

Section 1138 defines what counts as "subsidised expenditure" for the purposes of the research and development tax relief rules.

• Expenditure is subsidised if it has been met by a grant, subsidy, or payment from another party, or if it has received notified State aid
• Where notified State aid applies, all expenditure on the same R&D project is treated as subsidised, not just the specific amount covered by the aid
• Notified State aid means a State aid that has been approved by the European Commission
• Where a grant, subsidy, State aid, or third-party payment cannot be directly linked to specific expenditure, it must be apportioned on a just and reasonable basis