Corporation Tax Act 2009 section 814

Research and development

Section 814 limits how the intangible fixed assets rules apply where an asset represents expenditure on research and development.

• Where an intangible fixed asset represents R&D expenditure, most of the normal credits and debits rules for intangible assets are switched off.
• Only certain credit provisions still apply: receipts recognised as they accrue and royalty receipts, together with debits for reversals of gains previously recognised under those credit provisions.
• When calculating any gain or loss on realisation (disposal) of the asset, the cost of the asset is treated as excluding any R&D expenditure.
• "Research and development" takes its standard tax definition and also includes oil and gas exploration and appraisal.