Corporation Tax Act 2010 section 469

Conditions for qualifying as a scientific research association

Section 469 sets out the conditions that a body must satisfy in order to qualify as a scientific research association for a given accounting period, including requirements relating to its objects and restrictions on distributions to members.

• The body must be an association whose object is undertaking research and development capable of leading to or facilitating an extension of one or more classes of trade (Condition A).
• The body's memorandum of association or equivalent governing instrument must prohibit the direct or indirect payment or transfer of income or property to members by way of dividend, gift, bonus or other form of profit distribution (Condition B).
• Condition B does not prevent the body from paying members reasonable remuneration for goods, labour, power or services supplied, reasonable interest on money lent, or reasonable rent for premises.
• The Treasury has regulation-making powers to define what constitutes an association, to specify when conditions A or B are or are not met, and to clarify what counts as research and development or a class of trade for these purposes.