Part 8Intangible fixed assets

Chapter 6How credits and debits are given effect

Non-trading credits and debits

751Non-trading gains and losses

(1)

If there are non-trading credits or debits in an accounting period in respect of intangible fixed assets, the company’s non-trading gain or loss on such assets in the period must be calculated.

(2)

There is a non-trading gain on intangible fixed assets in an accounting period if subsection (3) or (4) applies.

(3)

If in the accounting period—

(a)

there are non-trading credits, but

(b)

there are no non-trading debits,

there is a non-trading gain on intangible fixed assets equal to the sum of the credits.

(4)

If in the accounting period—

(a)

there are both non-trading credits and non-trading debits, and

(b)

the total non-trading credits exceed the total non-trading debits,

there is a non-trading gain on intangible fixed assets equal to the excess.

(5)

There is a non-trading loss on intangible fixed assets in an accounting period if subsection (6) or (7) applies.

(6)

If in the accounting period—

(a)

there are non-trading debits, but

(b)

there are no non-trading credits,

there is a non-trading loss on intangible fixed assets equal to the sum of the debits.

(7)

If in the accounting period—

(a)

there are both non-trading credits and non-trading debits, and

(b)

the total non-trading debits exceed the total non-trading credits,

there is a non-trading loss on intangible fixed assets equal to the excess.

(8)

For the treatment of non-trading gains and losses see—

(a)

section 752 (charge to tax on non-trading gains on intangible fixed assets), and

(b)

section 753 (treatment of non-trading losses).

752Charge to tax on non-trading gains on intangible fixed assets

The charge to corporation tax on income applies to non-trading gains arising to a company on intangible fixed assets.

753Treatment of non-trading losses

(1)

A company that has a non-trading loss on intangible fixed assets for an accounting period may claim to have the whole or part of the loss set off against the company’s total profits for that period.

(2)

Such a claim must be made—

(a)

not later than the end of the period of 2 years immediately following the end of the accounting period to which it relates, or

(b)

within such further period as an officer of Revenue and Customs may allow.

(3)

To the extent that the loss is not—

(a)

set off against total profits on a claim under subsection (1), or

(b)

surrendered by way of group relief (see section 403 of ICTA),

it is carried forward to the next accounting period of the company and treated as if it were a non-trading debit of that period.