Commentary

D1.614 Corporate intangible regime—tax adjustments

Corporate tax
Corporate tax | Commentary

D1.614 Corporate intangible regime—tax adjustments

Corporate tax | Commentary

D1.614 Corporate intangible regime—tax adjustments

The starting point in determining the debits or credits recognised under the corporate intangible regime are the debits and credits in relation to a intangible fixed asset that are recognised in a company's accounts (see D1.611). These are then subject to any adjustment required by the corporate intangible regime, or the transfer pricing provisions. For details of the credits and debits which are to be adjusted see D1.620–D1.625 and D1.626–D1.629C respectively but essentially they would include amounts taken to profit and loss and also the cost of the intangible asset where the asset is capitalised and then written down for accounting purposes or written down under a fixed rate election (see D1.628).

Having established the accounting debits and credits the specific adjustments under the corporate intangible regime are set out in detail below but there may also be adjustments required for items which are:

  1.  

    •     royalty payments between related parties, see 'Royalties payments to a related party' in D1.601B

  2.  

    •     intangible assets with nil accounting values, see 'Assets with nil accounting values' in D1.611A

  3.  

    •     intangible assets held by lessors which are finance leases, 'Intangible assets and finance lessors' in D1.603

The specific adjustments required by the corporate intangible regime mirror the normal expenditure items which are disallowed under the general rules for the computation of profits or losses, although the corporate intangible regime does not import all the general rules. The adjustments are where there is1:

  1.  

    •     non-deductible expenditure

  2.  

    •     delayed payment of employees' remuneration

  3.  

    •    

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