SCHEDULES
SCHEDULE 19 Meaning of “research and development"
Part I The new definition
Research and development
1
In Part XIX of the Taxes Act 1988 (general supplementary provisions), after section 837 insert—
837A Meaning of “research and development”.
1
The following provisions have effect for the purposes of, and subject to, the provisions of the Tax Acts which apply this section.
2
“Research and development” means activities that fall to be treated as research and development in accordance with normal accounting practice.
This is subject to regulations under subsection (3) below.
3
The Treasury may by regulations provide—
a
that such activities as may be prescribed are not “research and development” for the purposes of this section, and
b
that such other activities as may be prescribed are “research and development” for those purposes.
4
Regulations under subsection (3) above may—
a
make provision by reference to guidelines issued (whether before or after the coming into force of this section) by the Secretary of State, and
b
make such supplementary, incidental, consequential or transitional provision as appears to the Treasury to be necessary or expedient.
5
In subsection (2) above “normal accounting practice” means normal accounting practice in relation to the accounts of companies incorporated in a part of the United Kingdom.
6
Unless otherwise expressly provided, “research and development" does not include oil and gas exploration and appraisal.