Corporation Tax Act 2009 section 735

Asset written down for tax purposes

Section 735 sets out how to calculate the taxable credit or debit when a company disposes of an intangible fixed asset that has previously been written down for tax purposes.

• When an intangible fixed asset is realised and tax debits have previously been claimed, the proceeds must be compared with the asset's tax written-down value immediately before realisation.
• If the proceeds exceed the tax written-down value, the excess is brought into account as a taxable credit.
• If the proceeds are less than the tax written-down value, the shortfall is brought into account as a tax debit.
• If there are no proceeds at all, the entire tax written-down value is brought into account as a tax debit.