Maximising relief for expenditure on intangibles

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Maximising relief for expenditure on intangibles por Mind Map: Maximising relief for expenditure on intangibles

1. Intangibles within scope of the rules

1.1. Created on or after 1 April 2002

1.2. Acquired from an unrelated party (not necessarily a company) on or after 1 April 2002

1.3. Acquired from a related party company on or after 1 April 2002 where the asset is an IFA asset in the hands of the related party

1.4. Acquired from a related party (not necessarily a company) on or after 1 April 2002 where the asset was acquired by the related party (the intermediary) on or after 1 April 2002 from a third person who is neither a related party of the intermediary nor the acquiring company

1.5. Acquired by the company from a related party (not necessarily a company) on or after 1 April 2002 where the asset was created by any person on or after 1 July 2002

2. Amounts taxable in line with accounting treatment

2.1. Receipts recognised in income statement as they accrue

2.2. Upward accounting revaluations but not above original cost

2.3. Negative goodwill

2.4. Reversal of prior deductible accounting debits

3. Amounts deductible in line with accounting treatment

3.1. Expenditure written off as incurred

3.2. Amortisation or impairment of capitalised expenditure in line with accounting treatment

3.3. 4% of capitalised expenditure p.a. by election

3.4. Reversal of prior taxable accounting credits

3.5. Abortive realisation costs

3.6. Goodwill & customer-related intangibles excluded

4. Amounts taxable on a realisation

4.1. Assets written down for tax purposes

4.1.1. Excess accounting credits over TWDV are taxable

4.1.2. Deficit of accounting credits in relation to TWDV is deductible

4.2. Assets not written down for tax purposes

4.2.1. Excess accounting credits over cost are taxable

4.2.2. Deficit of accounting credits in relation to cost is deductible

4.3. Goodwill and customer-related intangibles

5. Reliefs

5.1. Reinvestment (roll-over) relief

5.2. Reconstructions

6. Group situations

6.1. Tax neutral transfers within a group

6.2. De-grouping charges

7. Related parties

7.1. Market value transfers (broadly) between "related parties"

8. Anti-avoidance

8.1. General anti-avoidance rule applies