Finance Act 2002

Part 3 The relief

Deduction in computing profits of trade

11 (1) This paragraph applies where a company is entitled to relief under Part 1 or 2 of this Schedule for an accounting period.

(2) In so far as the company’s qualifying expenditure for that period is deductible in computing for tax purposes the profits for that period of a trade carried on by the company, it is entitled (on making a claim) to an additional deduction in computing the profits of the trade for that period of an amount equal to 25% of the qualifying expenditure.

(3) In sub-paragraph (2) “qualifying expenditure” means—

(a) in the case of relief under Part 1, qualifying R&D expenditure (see paragraph 3), and

(b) in the case of the relief under Part 2, qualifying sub-contracted R&D expenditure (see paragraph 8).