Corporation Tax Act 2010 section 357BLG

Cases where the company is a new entrant with insufficient information about pre-enactment expenditure

Section 357BLG provides relief for new entrant companies that lack sufficient historical expenditure data to calculate their R&D fraction under the Patent Box regime, by allowing them to elect alternative calculation methods.

• This section applies to new entrant companies with accounting periods beginning before 1 July 2021 that cannot obtain adequate expenditure information for the period 1 July 2013 to 30 June 2016
• For accounting periods starting on or after 1 July 2019, the company may elect to shorten the look-back period by replacing the start date of 1 July 2013 with 1 July 2016
• For accounting periods starting before 1 July 2019, the company may elect to use a rolling three-year period ending on the last day of the accounting period, with a broader definition of relevant R&D covering all research and development related to the trade
• Where the pre-1 July 2019 election is made, references to IP right acquisitions are also broadened by removing the requirement that they be "relevant" acquisitions, and certain restrictive definitions are disapplied