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Corporation Tax Act 2009
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Changes over time for: Section 1045
Changes to legislation:
Corporation Tax Act 2009, Section 1045 is up to date with all changes known to be in force on or before 25 November 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.
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Changes and effects yet to be applied to the whole Act associated Parts and Chapters:
- Blanket amendment words substituted by S.I. 2011/1043 art. 3 4
Whole provisions yet to be inserted into this Act (including any effects on those provisions):
- s. 322(2A)(zb) inserted by 2016 c. 24 s. 73(5)
- s. 1058B(5)(ea) inserted by 2023 c. 20 Sch. para. 57
- s. 1094(2A)-(2C) inserted by 2012 c. 14 Sch. 3 para. 13(3)
- s. 1106(4A)-(4C) inserted by 2012 c. 14 Sch. 3 para. 14(3)
1045Alternative treatment for pre-trading expenditure: deemed trading lossU.K.
This section has no associated Explanatory Notes
(1)A company is entitled to corporation tax relief for an accounting period if it meets [F1each of conditions A to D].
(2)Condition A is that the company is a small or medium-sized enterprise in the period.
[F2(2A)Condition B is that the company—
(a)meets the R&D intensity condition in the period, or
(b)obtained relief under this Chapter for its most recent prior accounting period of 12 months’ duration, having met the R&D intensity condition in that period.]
F3(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)Condition C is that the company has incurred qualifying Chapter 2 expenditure in the period which—
(a)is not allowable as a deduction in calculating for corporation tax purposes the profits of a trade carried on by it at the time the expenditure was incurred, but
(b)would have been so allowable had it, at that time, been carrying on a trade consisting of the activities in respect of which the expenditure was incurred.
[F4(4A)Condition D is that the company is not an ineligible company (see section 1142).]
(5)For the company to obtain the relief it must make an election [F5(see section 1047, and also section 1112F)].
F6...
(6)The relief is that the company is treated as if it had made a trading loss in the period.
(7)The trading loss is equal to [F7186%] of the qualifying Chapter 2 expenditure.
(8)If a company makes an election under this section in respect of qualifying Chapter 2 expenditure, section 61 (pre-trading expenses) does not apply to the expenditure.
F8(9). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(10)For the meaning of “qualifying Chapter 2 expenditure” see section 1051.
(11)See also section 1137, which makes provision about the accounting periods of a company which is not within the charge to corporation tax.
Textual Amendments
F1Words in s. 1045(1) substituted (with effect in relation to accounting periods beginning on or after 1.4.2024) by Finance Act 2024 (c. 3), Sch. 1 paras. 6(5)(a), 16 (with Sch. 1 para. 18); S.I. 2024/286, reg. 2
F2S. 1045(2A) inserted (with effect in relation to accounting periods beginning on or after 1.4.2024) by Finance Act 2024 (c. 3), Sch. 1 paras. 6(5)(b), 16 (with Sch. 1 paras. 18, 20); S.I. 2024/286, reg. 2
F3S. 1045(3) omitted (with effect in accordance with Sch. 3 para. 39 of the amending Act) by virtue of Finance Act 2012 (c. 14), Sch. 3 para. 3(4)(b)
F4S. 1045(4A) inserted (with effect in relation to accounting periods beginning on or after 1.4.2024) by Finance Act 2024 (c. 3), Sch. 1 paras. 6(5)(c), 16 (with Sch. 1 para. 18); S.I. 2024/286, reg. 2
F5Words in s. 1045(5) inserted (with effect in relation to accounting periods beginning on or after 1.4.2024) by Finance Act 2024 (c. 3), Sch. 1 paras. 6(5)(d)(i), 16 (with Sch. 1 para. 18); S.I. 2024/286, reg. 2
F6Words in s. 1045(5) omitted (with effect in relation to accounting periods beginning on or after 1.4.2024) by virtue of Finance Act 2024 (c. 3), Sch. 1 paras. 6(5)(d)(ii), 16 (with Sch. 1 para. 18); S.I. 2024/286, reg. 2
F7Word in s. 1045(7) substituted (in relation to expenditure incurred on or after 1.4.2023) by Finance Act 2023 (c. 1), s. 4(3)(b)(4)
F8S. 1045(9) omitted (with effect in relation to accounting periods beginning on or after 1.4.2024) by virtue of Finance Act 2024 (c. 3), Sch. 1 paras. 6(5)(e), 16 (with Sch. 1 para. 18); S.I. 2024/286, reg. 2
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