Modifications etc. (not altering text)
C1Pt. 13 Ch. 1 modified (8.11.1995) by Atomic Energy Authority Act 1995 (c. 37), Sch. 3 para. 20
F1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F1Ss. 520-523 repealed (with effect in accordance with s. 579 of the repealing Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 44, Sch. 4
F2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F2Ss. 520-523 repealed (with effect in accordance with s. 579 of the repealing Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 44, Sch. 4
F3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F3Ss. 520-523 repealed (with effect in accordance with s. 579 of the repealing Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 44, Sch. 4
F4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F4Ss. 520-523 repealed (with effect in accordance with s. 579 of the repealing Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 44, Sch. 4
(1)M1Subject to subsection (2) below, where a [F5company] resident in the United Kingdom sells all or any part of any patent rights and the net proceeds of the sale consist wholly or partly of a capital sum, [F5the company] shall, subject to the provisions of this Chapter, be charged to [F6corporation tax] under Case VI of Schedule D, for the [F7accounting] period in which the sum is received by [F5it] and successive [F7accounting] periods, being charged in each period on the same fraction of the sum as the period is of six years (or such less fraction as has not already been charged).
(2)If the [F8company] by notice served on [F9an officer of the Board within the period specified in subsection (2A) below], elects that the whole of the sum shall be charged to [F10corporation] tax for [F11the [F12accounting] period in which it was received], it shall be charged to [F10corporation] tax accordingly.
[F13(2A)The period mentioned in subsection (2) above is—
(a)F14. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(b)F15. . . the period of two years beginning at the end of the accounting period in which the sum was received.]
(3)[F16M2Where a relevant non-resident company] sells all or any part of any patent rights and the net proceeds of the sale consist wholly or partly of a capital sum, and the patent is a United Kingdom patent, then, subject to the provisions of this Chapter—
(a)[F17the company shall be chargeable to corporation tax] in respect of that sum under Case VI of Schedule D; F18. . .
(b)F18. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(c)F18. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)F19. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[F20(5)In subsection (3) above “relevant non-resident company” means a company not resident in the United Kingdom which would be within the charge to corporation tax in respect of any proceeds of the sale of the patent rights not consisting of a capital sum.]
(6)Where subsection (3) applies to charge a company to corporation tax in respect of a sum paid to it, F21. . . the company may, by notice given to the Board not later than two years after the end of the accounting period in which the sum is paid, elect that the sum shall be treated as arising rateably in the accounting periods ending not later than six years from the beginning of that in which the sum is paid (being accounting periods during which the company remains within the charge to corporation tax in respect of any proceeds of the sale not consisting of a capital sum), and there shall be made all such repayments of tax and assessments to tax as are necessary to give effect to any such election.
(7)M3Subject to subsections (8) and (9) below, where the [F22company] selling all or any part of any patent rights (“the seller”) acquired the rights sold, or the rights out of which they were granted, by purchase and the price paid by [F23it] consisted wholly or partly of a capital sum, the preceding provisions of this section shall apply as if any capital sum received by [F23it] when [F24it] sells the rights were reduced by the amount of that sum.
(8)Where between the purchase and the sale the seller has sold part of the rights acquired by [F25it] and the net proceeds of that sale consist wholly or partly of a capital sum, the amount of the reduction falling to be made under subsection (7) above in respect of the subsequent sale shall be itself reduced by the amount of that sum.
[F26(9)If a company is chargeable to corporation tax under subsection (3) above, nothing in subsections (7) and (8) above shall affect the sum representing income tax which is to be deducted under section 910 of ITA 2007 (payments to non-UK residents) from payments of, or of instalments of, the proceeds of the sale.
(9A)If any sum representing income tax is deducted under section 910 of ITA 2007, any adjustment necessary to give effect to the provisions of subsection (9) above shall be made by way of repayment of tax.]
(10)M4A claim for relief under this section shall be made to the Board.
Textual Amendments
F5Words in s. 524(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(2)(a) (with Sch. 2)
F6Words in s. 524(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(2)(b) (with Sch. 2)
F7Words in s. 524(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(2)(c) (with Sch. 2)
F8Word in s. 524(2) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(3)(a) (with Sch. 2)
F9Words in s. 524(2) substituted (with effect in accordance with s. 135(2) of the amending Act) by Finance Act 1996 (c. 8), Sch. 21 para. 15(2)(a)
F10Words in s. 524(2) inserted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(3)(b) (with Sch. 2)
F11Words in s. 524(2) substituted (with effect in accordance with s. 135(2) of the amending Act) by Finance Act 1996 (c. 8), Sch. 21 para. 15(2)(b)
F12Word in s. 524(2) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(3)(c) (with Sch. 2)
F13S. 524(2A) inserted (with effect in accordance with s. 135(2) of the amending Act) by Finance Act 1996 (c. 8), Sch. 21 para. 15(3)
F14S. 524(2A)(a) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(4)(a), Sch. 3 (with Sch. 2)
F15Words in s. 524(2A)(b) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(4)(b), Sch. 3 (with Sch. 2)
F16Words in s. 524(3) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(5)(a) (with Sch. 2)
F17Words in s. 524(3)(a) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(5)(b) (with Sch. 2)
F18S. 524(3)(b)(c) and preceding word repealed (6.4.2007 with effect in accordance with s. 1034(1) of the repealing Act) by Income Tax Act 2007 (c. 3), Sch. 1 para. 107(2), Sch. 3 Pt. 1 (with Sch. 2)
F19S. 524(4) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(6), Sch. 3 (with Sch. 2)
F20S. 524(5) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(7) (with Sch. 2)
F21Words in s. 524(6) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(8), Sch. 3 (with Sch. 2)
F22Word in s. 524(7) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(9)(a) (with Sch. 2)
F23Words in s. 524(7) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(9)(b) (with Sch. 2)
F24Word in s. 524(7) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(9)(c) (with Sch. 2)
F25Word in s. 524(8) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 201(10) (with Sch. 2)
F26S. 524(9)(9A) substituted for s. 524(9) (6.4.2007 with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), Sch. 1 para. 107(3) (with Sch. 2)
Marginal Citations
M1Source - 1970 s.380(1)
M2Source - 1970 s.380(2)
M3Source - 1970 s.380(4)
M4Source - 1970 s.380(5)
[F28(1)Where a body corporate on which, by reason of the receipt of a capital sum, a charge falls or would otherwise fall to be made under section 524 commences to be wound up—
(a)no sums shall be charged under that section on that body for any accounting period subsequent to that in which the winding up commences; and
(b)the amount falling to be charged for the accounting period in which the winding up commences shall be increased by the total amounts which, but for the winding up, would have fallen to be charged for subsequent accounting periods.]
(2)F29. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3)M5Where, under [F30section 559 of the Capital Allowances Act (effect of successions)] as applied by section 532, a charge under section 524 falls to be made on two or more persons jointly as being the persons for the time being carrying on a trade, and that trade is discontinued, subsection (1) above shall have effect in relation to the discontinuance as it has effect where a body corporate commences to be wound up.
(4)Where subsection (3) above applies—
(a)the additional sum which, under subsection (1) above, falls to be charged for the [F31accounting period] in which the discontinuance occurs shall be apportioned among the members of the partnership immediately before the discontinuance, according to their respective interests in the partnership profits before the discontinuance, and each partner F32. . . shall be charged separately for [F33its] proportion; F34. . .
(b)F34. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5)F35. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F27Word in s. 525 sidenote omitted (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by virtue of Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 202(5) (with Sch. 2)
F28S. 525(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 202(2) (with Sch. 2)
F29S. 525(2) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 202(3), Sch. 3 (with Sch. 2)
F30Words in s. 525(3) substituted (with effect in accordance with s. 579 of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 45
F31Words in s. 525(4)(a) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 202(4)(a)(i) (with Sch. 2)
F32Words in s. 525(4)(a) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 202(4)(a)(ii), Sch. 3 (with Sch. 2)
F33Word in s. 525(4)(a) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 202(4)(a)(iii) (with Sch. 2)
F34S. 525(4)(b) and preceding word repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 202(4)(b), Sch. 3 (with Sch. 2)
F35S. 525(5) repealed (with effect in accordance with Sch. 14 Pt. 8 Note 4 of the repealing Act) by Finance Act 1988 c. 39, Sch. 14 Pt. 8
Marginal Citations
M5Source - 1970 s.381(2)
M6(1)Where—
(a)a [F36company], otherwise than for the purposes of a trade carried on by [F37it], pays any fees or incurs any expenses in connection with the grant or maintenance of a patent, or the obtaining of an extension of a term of a patent, or a rejected or abandoned application for a patent, and
(b)those fees or expenses would, if they had been paid or incurred for the purposes of a trade, have been allowable as a deduction in estimating the [F38profits] of that trade,
there shall be made to [F39the company for the purposes of corporation tax], for the [F40accounting] period in which those expenses were paid or incurred, an allowance equal to the amount thereof.
(2)F41. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F36Word in s. 526(1)(a) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 203(2)(a) (with Sch. 2)
F37Word in s. 526(1)(a) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 203(2)(b) (with Sch. 2)
F38Word in s. 526(1)(b) substituted (31.7.1998) by Finance Act 1998 (c. 36), s. 46(3)(a), Sch. 7 para. 1
F39Words in s. 526(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 203(2)(c) (with Sch. 2)
F40Word in s. 526(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 203(2)(d) (with Sch. 2)
F41S. 526(2) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 203(3), Sch. 3 (with Sch. 2)
Marginal Citations
M6Source - 1970 s.382
(a)a royalty or other sum is paid to a company in respect of the user of a patent,
(b)the user extended over a period of six complete years or more, and
(c)the payment is one from which a sum representing income tax must be deducted under section 903 of ITA 2007,
the company may on the making of a claim require that the corporation tax payable by it by reason of the receipt of that sum shall be reduced so as not to exceed the total amount of corporation tax which would have been payable by it if that royalty or sum had been paid in six equal instalments at yearly intervals, the last of which was paid on the date on which the payment was in fact made.]
(2)Subsection (1) above shall apply in relation to a royalty or other sum where the period of the user is two complete years or more but less than six complete years as it applies to the royalties and sums mentioned in that subsection, but with the substitution for the reference to six equal instalments of a reference to so many equal instalments as there are complete years comprised in that period.
(3)F43. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)F44. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F42S. 527(1) substituted (6.4.2007 with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), Sch. 1 para. 108(2) (with Sch. 2)
F43S. 527(3) repealed (with effect in accordance with Sch. 14 Pt. 8 Note 5 of the repealing Act) by Finance Act 1988 (c. 39), Sch. 14 Pt. 8
F44S. 527(4) repealed (6.4.2007 with effect in accordance with s. 1034(1) of the repealing Act) by Income Tax Act 2007 (c. 3), Sch. 1 para. 108(3), Sch. 3 Pt. 1 (with Sch. 2)
Marginal Citations
M7Source - 1970 s.384
M8(1)F45. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2)F46. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3)Where an allowance falls to be made to a company for any accounting period under [F47section 526]F48. . . , and is not to be made in taxing a trade—
(a)the allowance shall, as far as may be, be given effect by deducting the amount of the allowance from the company’s income from patents of the accounting period;
(b)where the allowance cannot be given full effect under paragraph (a) above in that period by reason of a want or deficiency of income from patents, then (so long as the company remains within the charge to corporation tax) the amount unallowed shall be carried forward to the succeeding accounting period, and shall be treated for the purposes of that paragraph, and of any further application of this paragraph, as the amount of a corresponding allowance for that period.
[F49(3A)In this section references to F50. . . a company’s income from patents are references to that income after any allowance has been deducted from or set off against it under section F50. . . 480 of the Capital Allowances Act.]
(4)F45. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F45S. 528(1)(4) repealed (with effect in accordance with s. 579 of the repealing Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 46(1)(4), Sch. 4
F46S. 528(2) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 205(2), Sch. 3 (with Sch. 2)
F47Words in s. 528(2)(3) substituted (with effect in accordance with s. 579 of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 46(2)
F48Words in s. 528(3) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 205(3), Sch. 3 (with Sch. 2)
F49S. 528(3A) inserted (with effect in accordance with s. 579 of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 46(3)
F50Words in s. 528(3A) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 205(4), Sch. 3 (with Sch. 2)
Marginal Citations
M8Source-1970 s.385; 1985 s.64(2)(d)-(f)
F51. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F51S. 529 repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 206, Sch. 3 (with Sch. 2)
F52. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F52S. 530 repealed (with effect in accordance with s. 579 of the repealing Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 47, Sch. 4
(1)M9Subject to subsection (7) below, where, after 19th March 1968, [F53a company] disposes of know-how which has been used in a trade carried on by [F54the company], and continues to carry on the trade after the disposal, the amount or value of any consideration received by [F54the company] for the disposal shall—
(a)if it is received in respect of the disposal of know-how after 31st March 1986, so far as it is not brought into account [F55as a disposal value under section 462 of the Capital Allowances Act], nor is chargeable to [F56corporation tax] as a revenue or income receipt;
(b)in any other case, so far as it is not chargeable to [F56corporation tax] as a revenue or income receipt,
be treated for [F57the purposes of corporation tax] as a trading receipt.
[F58(2)Subject to subsection (3) below, where—
(a)a person carrying on a trade receives consideration for the disposal of know-how which has been used in the trade, and
(b)the know-how is disposed of as part of the disposal of all or part of the trade,
the consideration shall for the purposes of corporation tax be treated as a payment for goodwill in relation both to the person making the disposal and to the person acquiring the know-how (if that person provided the consideration).]
(3)Subsection (2) above shall not apply—
(a)[F59if, in the case of the person disposing of the know-how being within the charge to corporation tax, that person and the person acquiring the know-how (whether or not within the charge to corporation tax) elect for that subsection not to apply] by notice given jointly to the inspector within two years of the disposal, or
(b)to the person acquiring the know-how if the trade in question was, before the acquisition, carried on wholly outside the United Kingdom;
F60. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[F61(3A)If—
(a)an election is made under section 194 of ITTOIA 2005 (provision corresponding to subsections (2) and (3) of this section for the purposes of income tax), and
(b)the person making the acquisition mentioned in that section is within the charge to corporation tax,
the persons making the election under that section are treated as also making an election under subsection (3) of this section (even though the person disposing of the know-how is not within the charge to corporation tax).]
(4)M10Subject to subsections (5) and (7) below, any consideration received by a [F62company] for the disposal of know-how shall—
(a)if it is received in respect of the disposal of know-how after 31st March 1986 and is not brought into account [F63as a disposal value under section 462 of the Capital Allowances Act], or
(b)if it is neither chargeable to [F64corporation tax] under subsection (1) above or otherwise as a revenue or income receipt, nor dealt with in relation to [F65the company] as a payment for goodwill as mentioned in subsection (2) above, (whether the disposal took place before or after 31st March 1986),
be treated as a profit or gain chargeable to [F64corporation tax] under Case VI of Schedule D.
(5)M11Where the [F66company] concerned has incurred expenditure wholly and exclusively in the acquisition or disposal of the know-how, the amount which would apart from this subsection be treated as a profit or gain chargeable to [F67corporation tax] under Case VI of Schedule D shall be reduced by the amount of that expenditure; but a deduction shall not be twice made in respect of the same expenditure, whether under this subsection or otherwise.
(6)F68. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(7)Subsections (1) and (3) to [F69(5)] above F70. . . shall not apply on any sale of know-how where the buyer is a body of persons over whom the seller has control, or the seller is a body of persons over whom the buyer has control, or both the seller and the buyer are bodies of persons and some other person has control over both of them; and subsection (2) above shall apply in any such case with the omission of the words “Subject to subsection (3) below”.
In this subsection references to a body of persons include references to a partnership.
(8)M12Where in connection with any disposal of know-how a person gives an undertaking (whether absolute or qualified, and whether legally valid or not) the tenor or effect of which is to restrict his or another’s activities in any way, any consideration received in respect of the giving of the undertaking or its total or partial fulfilment shall be treated for the purposes of this section as consideration received for the disposal of the know-how.
Textual Amendments
F53Words in s. 531(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(2)(a) (with Sch. 2)
F54Words in s. 531(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(2)(b) (with Sch. 2)
F55Words in s. 531(1) substituted (with effect in accordance with s. 579 of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 48(1)
F56Words in s. 531(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(2)(c) (with Sch. 2)
F57Words in s. 531(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(2)(d) (with Sch. 2)
F58S. 531(2) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(3) (with Sch. 2)
F59Words in s. 531(3)(a) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(4) (with Sch. 2)
F60Words in s. 531(3) repealed (with effect in accordance with s. 579 of the repealing Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 48(2), Sch. 4
F61S. 531(3A) inserted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(5) (with Sch. 2)
F62Word in s. 531(4) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(6)(a) (with Sch. 2)
F63Words in s. 531(4)(a) substituted (with effect in accordance with s. 579 of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 48(3)
F64Words in s. 531(4) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(6)(c) (with Sch. 2)
F65Words in s. 531(4)(b) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(6)(b) (with Sch. 2)
F66Word in s. 531(5) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(7)(a) (with Sch. 2)
F67Words in s. 531(5) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(7)(b) (with Sch. 2)
F68S. 531(6) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(8), Sch. 3 (with Sch. 2)
F69Word in s. 531(7) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 207(9) (with Sch. 2)
F70Words in s. 531(7) repealed (with effect in accordance with s. 579 of the repealing Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 48(4), Sch. 4
Modifications etc. (not altering text)
C2S. 531(2)(7) excluded (8.11.1995) by Atomic Energy Authority Act 1995 (c. 37), Sch. 3 para. 19(2)
Marginal Citations
M9Source-1970 s.386(2); 1985 s.65(3)(a)
M10Source-1970 s.386(4); 1985 s.65(3)(b)
M11Source-1970 s.386(4)-(6)
M12Source-1970 s.386(8); 1985 Sch.18 Part II 8
The [F72Corporation Tax Acts] have effect as if sections 524 to [F73528] and 531, this section and section 533 were contained in the Capital Allowances Act.]
Textual Amendments
F71S. 532 substituted (with effect in accordance with s. 579 of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 49
F72Words in s. 532 substituted (6.4.2007 with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), Sch. 1 para. 109 (with Sch. 2)
F73Words in s. 532 substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 208 (with Sch. 2)
(1)M13In [F74sections 524 to [F75528]]—
[F76“income from patents” means—
any royalty or other sum paid in respect of the use of a patent; and
any amount on which tax is payable for any accounting period by virtue of section 524 or 525 above or section 472(5) of, or paragraph 100 of Schedule 3 to, the Capital Allowances Act,
but does not include any amount chargeable to income tax.]
F77. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
“patent rights” means the right to do or authorise the doing of anything which would, but for that right, be an infringement of a patent;
“United Kingdom patent” means a patent granted under the laws of the United Kingdom.
(2)Subject to subsection (3) below, in [F74sections 524 to [F78528]] any reference to the sale of part of patent rights includes a reference to the grant of a licence in respect of the patent in question, and any reference to the purchase of patent rights includes a reference to the acquisition of a licence in respect of a patent.
(3)If a licence granted by a person entitled to any patent rights is a licence to exercise those rights to the exclusion of the grantor and all other persons for the whole of the remainder of the term for which the right subsists, the grantor shall be treated for the purposes of [F74sections 524 to [F78528]] as thereby selling the whole of the rights.
(4)Where, under sections 46 to 49 of the Patents Act 1949 [F79, sections 55 to 59 of the Patents Act 1977] or any corresponding provisions of the law of any country outside the United Kingdom, an invention which is the subject of a patent is made, used, or exercised or vended by or for the service of the Crown or the government of the country concerned, [F74sections 524 to [F78528]] shall have effect as if the making, user, exercise or vending of the invention had taken place in pursuance of a licence, and any sums paid in respect thereof shall be treated accordingly.
(5)Expenditure incurred in obtaining a right to acquire in the future patent rights as respects any invention in respect of which the patent has not yet been granted shall be deemed for all the purposes of [F74sections 524 to [F78528]] to be expenditure on the purchase of patent rights, and if the patent rights are subsequently acquired the expenditure shall be deemed for those purposes to have been expenditure on the purchase of those rights.
(6)Any sum received from a person which by virtue of subsection (5) above is deemed to be expenditure incurred by him on the purchase of patent rights shall be deemed to be proceeds of a sale of patent rights.
(7)M14In [F80section 531]“know-how” means any industrial information and techniques likely to assist in the manufacture or processing of goods or materials, or in the working of a mine, oil-well or other source of mineral deposits (including the searching for, discovery or testing of deposits or the winning of access thereto), or in the carrying out of any agricultural, forestry or fishing operations.
Textual Amendments
F74Words in ss. 533(1)-(5) substituted (with effect in accordance with s. 579 of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 50(1)
F75Words in s. 533(1) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 209(2)(a) (with Sch. 2)
F76S. 533(1): definition of "income from patents" substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 209(2)(b) (with Sch. 2)
F77Words in s. 533(1) repealed (with effect in accordance with s. 579 of the repealing Act) by Capital Allowances Act 2001 (c. 4), Sch. 2 para. 50(2)(b), Sch. 4
F78Words in s. 533(2)-(5) substituted (6.4.2005 with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 209(3) (with Sch. 2)
F79Words in s. 533(4) inserted (with retrospective effect) by Finance Act 1988, Sch. 13 Pt. 1 paras. 5, 1
F80Words in s. 533(7) substituted (with effect in accordance with s. 579 of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 50(3)
Marginal Citations
M13Source-1970 s.388; 1985 s.64(2)(g)
M14Source-1970 s.386(8); 1985 Sch.18 Part II 8
F81. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F81S. 534 repealed (with effect in accordance with s. 71(3) of the repealing Act) by Finance Act 2001 (c. 9), Sch. 33 Pt. 2(6)
F82. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F82S. 535 repealed (with effect in accordance with s. 71(3) of the repealing Act) by Finance Act 2001 (c. 9), Sch. 33 Pt. 2(6)
F83. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F83Ss. 536, 537, 537B repealed (6.4.2007 with effect in accordance with s. 1034(1) of the repealing Act) by Income Tax Act 2007 (c. 3), Sch. 1 para. 110, Sch. 3 Pt. 1 (with Sch. 2)
F84. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F84Ss. 536, 537, 537B repealed (6.4.2007 with effect in accordance with s. 1034(1) of the repealing Act) by Income Tax Act 2007 (c. 3), Sch. 1 para. 110, Sch. 3 Pt. 1 (with Sch. 2)
Textual Amendments
F85Ss. 537A, 537B and preceding cross-heading inserted (1.8.1989) by Intellectual Property Act 1988 (c. 48), Sch. 7 para. 36(6); S.I. 1989/816, art. 2
F86. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F86S. 537A repealed (with effect in accordance with s. 71(3) of the repealing Act) by Finance Act 2001 (c. 9), Sch. 33 Pt. 2(6)
F87. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]
Textual Amendments
F87Ss. 536, 537, 537B repealed (6.4.2007 with effect in accordance with s. 1034(1) of the repealing Act) by Income Tax Act 2007 (c. 3), Sch. 1 para. 110, Sch. 3 Pt. 1 (with Sch. 2)
F88. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F88S. 538 repealed (with effect in accordance with s. 71(3) of the repealing Act) by Finance Act 2001 (c. 9), Sch. 33 Pt. 2(6)