Search Legislation

Finance Act 2002

Status:

This is the original version (as it was originally enacted).

Part 3Credits in respect of intangible fixed assets

Introduction

13(1)This Part provides for credits to be brought into account by a company for tax purposes in respect of—

(a)receipts in respect of intangible fixed assets that are recognised in the profit and loss account as they accrue (see paragraph 14),

(b)revaluation of an intangible fixed asset (see paragraph 15),

(c)credits recognised for accounting purposes in respect of negative goodwill (see paragraph 16), and

(d)the reversal of previous accounting debits in respect of an intangible fixed asset (see paragraph 17).

(2)This Part does not apply in relation to amounts brought into account in connection with the realisation of an intangible fixed asset within the meaning of Part 4.

Receipts recognised as they accrue

14(1)Where in a period of account a gain representing a receipt in respect of an intangible fixed asset is recognised in the company’s profit and loss account, a corresponding credit shall be brought into account for tax purposes.

(2)Subject to any adjustment required for tax purposes, the amount of the credit recognised for tax purposes under this paragraph is the same as the amount of the gain recognised by the company for accounting purposes.

Revaluation

15(1)Where in a period of account the accounting value of an intangible fixed asset is increased on a revaluation, a credit shall be brought into account for tax purposes.

(2)The amount of the credit for tax purposes is—

(a)the amount corresponding for tax purposes to the increase in value (see sub-paragraph (3)), or

(b)if less, the net aggregate amount of relevant tax debits previously brought into account (see sub-paragraph (4)).

(3)The amount corresponding for tax purposes to the increase in value is:

Entry incomplete

where—

  • Accounting Adjustment is the amount of the increase in the accounting value of the asset,

  • Tax Value is the tax written down value of the asset immediately before the revaluation, and

  • Accounting Value is the accounting value of the asset by reference to which the revaluation is carried out.

(4)The net aggregate amount of relevant tax debits previously brought into account is:

PreviousDebits - Previous Credits

where—

  • Previous Debits is the total amount of debits previously brought into account for tax purposes in respect of the asset under paragraph 9 (writing down on accounting basis), and

  • Previous Credits is the total amount of any credits previously brought into account for tax purposes in respect of the asset under this paragraph.

(5)For the purposes of this paragraph a “revaluation” includes—

(a)the valuation of an asset for which a value is shown in the company’s balance sheet but which has not previously been the subject of a valuation, and

(b)the restoration of past losses.

(6)This paragraph does not apply to an asset in respect of which an election has been made under paragraph 10 (election for writing down at fixed rate).

Negative goodwill

16(1)Where in a period of account a gain is recognised in the company’s profit and loss account in respect of negative goodwill arising on an acquisition of a business, a corresponding credit shall be brought into account for tax purposes.

(2)The amount of the credit is so much of the gain recognised for accounting purposes as, on a just and reasonable apportionment, is attributable to intangible fixed assets.

Reversal of previous accounting loss

17(1)Where in a period of account a gain is recognised in the company’s profit and loss account reversing (in whole or in part) a loss recognised in a previous period of account in respect of which a debit was brought into account for tax purposes under Part 2 (debits in respect of intangible fixed assets), a corresponding credit shall be brought into account for tax purposes.

(2)The amount of the credit to be brought into account for tax purposes is:

Entry incomplete

where—

  • Accounting Gain is the amount of the gain recognised for accounting purposes,

  • Accounting Loss is the amount of the loss that is reversed (in whole or in part), and

  • Tax Debit is the amount of the tax debit brought into account in respect of the loss.

(3)This paragraph does not apply to a gain on a revaluation within the meaning of paragraph 15.

Back to top

Options/Help

Print Options

You have chosen to open The Whole Act

The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

You have chosen to open The Whole Act as a PDF

The Whole Act you have selected contains over 200 provisions and might take some time to download.

Would you like to continue?

You have chosen to open the Whole Act

The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

You have chosen to open Schedules only

The Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

Close

Legislation is available in different versions:

Latest Available (revised):The latest available updated version of the legislation incorporating changes made by subsequent legislation and applied by our editorial team. Changes we have not yet applied to the text, can be found in the ‘Changes to Legislation’ area.

Original (As Enacted or Made):The original version of the legislation as it stood when it was enacted or made. No changes have been applied to the text.

Close

Opening Options

Different options to open legislation in order to view more content on screen at once

Close

More Resources

Access essential accompanying documents and information for this legislation item from this tab. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as enacted version that was used for the print copy
  • lists of changes made by and/or affecting this legislation item
  • confers power and blanket amendment details
  • all formats of all associated documents
  • correction slips
  • links to related legislation and further information resources
Close

More Resources

Use this menu to access essential accompanying documents and information for this legislation item. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as enacted version that was used for the print copy
  • correction slips

Click 'View More' or select 'More Resources' tab for additional information including:

  • lists of changes made by and/or affecting this legislation item
  • confers power and blanket amendment details
  • all formats of all associated documents
  • links to related legislation and further information resources