Corporation Tax Act 2009

869 Bad debts etc

(1) No debit may be brought into account for the purposes of this Part in respect of a debt owed to the company, except—

(a) by way of impairment loss, or

(b) so far as the debt is released as part of a statutory insolvency arrangement.

(2) If a debt is so released, any gain in respect of the release that is brought into account for accounting purposes by the debtor is disregarded for the purposes of this Part.

(3) Any other gain in respect of an unpaid debt in respect of an intangible fixed asset that is brought into account by the debtor for accounting purposes is treated for the purposes of section 721 (receipts recognised as they accrue) as a gain in respect of an intangible fixed asset.

(4) Any adjustment required by this section of an accounting gain or loss that is partly referable to an amount affected by this section and partly to other matters must be made on a just and reasonable basis.

(5) In this section “debt” includes an obligation or liability that falls to be discharged otherwise than by the payment of money.