Corporation Tax Act 2009 section 873

Effect of application of section 872 in later period and subsequently

Section 873 explains how the adjustment credits or debits arising from a change of accounting policy (under section 872) affect the tax written-down value of an intangible fixed asset going forward.

• Any credit or debit required by section 872 is treated as arising at the beginning of the later accounting period (the "relevant time")
• If a credit arises, the tax written-down value at the relevant time equals the previous tax written-down value plus the credit; if a debit arises, it equals the previous value minus the debit
• After the relevant time, the cost recognised for tax purposes is the adjusted tax written-down value plus any subsequent capitalised expenditure on the asset
• After the relevant time, the tax written-down value going forward is determined solely by reference to subsequent credits and debits