Corporation Tax Act 2009 (c. 4)

[F1 PART 15B U.K. Video games development

Textual Amendments

F1 Pt. 15B inserted (17.7.2013 for specified purposes and 1.4.2014 in so far as not already in force) by Finance Act 2013 (c. 29), Sch. 17 paras. 1, 2; S.I. 2014/1962, art. 2(1)(2)

CHAPTER 3 U.K. Video games tax relief

Additional deductions U.K.

1217CF Additional deduction for qualifying expenditure U.K.

(1) If video games tax relief is available to the company, it may (on making a claim) make an additional deduction in respect of qualifying expenditure on the video game.

(2) The deduction is made in calculating the profit or loss of the separate video game trade.

(3) In this Chapter “qualifying expenditure” means core expenditure on the video game that falls to be taken into account under Chapter 2 in calculating the profit or loss of the separate video game trade for tax purposes.

[F2 (3A) But if the core expenditure on the video game includes sub-contractor payments which (in total) exceed £1 million, the excess is not “qualifying expenditure”.]

(4) The Treasury may by regulations—

(a) amend [F3 subsections (3) and (3A)], and

(b) provide that expenditure of a specified description is or is not to be regarded as qualifying expenditure.

[F4 (5) In this section, “sub-contractor payment” means a payment made by the company to another person in respect of work on design, production or testing of the video game that is contracted out by the company to the person.]

Textual Amendments

F2 S. 1217CF(3A) inserted (with effect in accordance with s. 34(8) of the amending Act) by Finance Act 2014 (c. 26), s. 34(5)(a)

F3 Words in s. 1217CF(4)(a) substituted (with effect in accordance with s. 34(8) of the amending Act) by Finance Act 2014 (c. 26), s. 34(5)(b)

F4 S. 1217CF(5) inserted (with effect in accordance with s. 34(8) of the amending Act) by Finance Act 2014 (c. 26), s. 34(5)(c)

1217CG Amount of additional deduction U.K.

(1) For the first period of account during which the separate video game trade is carried on, the amount of the additional deduction is—

where E is—

a

so much of the qualifying expenditure as is [F5 European expenditure], or

b

if less, 80% of the total amount of qualifying expenditure.

(2) For any period of account after the first, the amount of the additional deduction is given by—

where—

E is—

(a)

so much of the qualifying expenditure incurred to date as is [F5 European expenditure], or

(b)

if less, 80% of the total amount of qualifying expenditure incurred to date, and

P is the total amount of the additional deductions given for previous periods.

(3) The Treasury may by regulations amend this section.]

Textual Amendments

F5 Words in s. 1217CG substituted (31.12.2020) by The Taxes (Amendments) (EU Exit) Regulations 2019 (S.I. 2019/689), regs. 1, 16(25) (with regs. 39-41); 2020 c. 1, Sch. 5 para. 1(1)