Corporation Tax Act 2009 section 857

Deemed market value acquisition: adjustment where nil accounting value

Section 857 explains how to adjust accounting figures when a company is treated as acquiring an intangible fixed asset at market value but the asset has a nil (zero) value in the company's accounts.

• Applies when an intangible asset is deemed acquired at market value under Part 8, but the transferee records nil accounting value for that asset
• References to accounting cost, accounting value, or any recognised loss on capitalised expenditure must be calculated as though the asset had actually been acquired at market value
• The most common scenario is internally-generated goodwill, which typically has no cost recognised in the accounts
• Any subsequent revaluation of the asset in the accounts is disregarded for the purposes of these calculations