Corporation Tax Act 2009 section 734

Meaning of "realisation"

Section 734 defines what counts as a "realisation" of an intangible fixed asset for the purposes of the corporation tax rules on intangible assets.

• A realisation occurs when, in accordance with generally accepted accounting practice, an intangible fixed asset either ceases to be recognised on the balance sheet or is reduced in accounting value
• The term "transaction" is broadly defined and includes any event that gives rise to a gain recognised for accounting purposes
• Assets with no balance sheet value — such as internally generated goodwill or fully written-off assets — are still treated as if they have a balance sheet value, so the realisation rules can apply to them
• A "part realisation" is specifically defined as a realisation that involves a reduction in the accounting value of the asset, rather than its complete removal from the balance sheet