Capital Allowances Act 2001 (c. 2)

Part 8 Patent allowances

Chapter 3 Allowances and charges

477 Limit on amount of disposal value

(1) The amount of any disposal value, or the total amount of any disposal values, required to be brought into account by a person—

(a) on the sale of the whole of any patent rights, or

(b) on one or more sales of part of any patent rights,

is limited to the capital expenditure incurred by the person on purchasing the rights.

(2) But subsection (3) applies if the person acquired the rights as a result of—

(a) a transaction which was between connected persons, or

(b) a series of transactions each of which was between connected persons.

(3) That amount, or total amount, is limited to the capital expenditure on purchasing the rights incurred by whichever party to the transaction, or to any of the transactions, incurred the greatest such expenditure.