Amortisation of intangible fixed assets


Published by a ÀÏ˾»úÎçÒ¹¸£Àû Tax expert
Practice notes

Amortisation of intangible fixed assets


Published by a ÀÏ˾»úÎçÒ¹¸£Àû Tax expert

Practice notes
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Where a company acquires (or otherwise incurs capitalised expenditure upon) an intangible fixed asset that falls within the corporate intangible fixed asset regime (IFA regime):

  1. •

    no capital allowances are available in respect of that intangible fixed asset (since the IFA regime is an exclusive regime), but

  2. •

    the company will be able to claim a tax deduction for amortisation of the intangible fixed asset

The amount of the tax deduction will generally be the accounts amortisation but where there is no amortisation in the accounts, where certain reliefs are available or where the company elects for a fixed rate deduction the amount recognised for tax purposes may vary from the accounts.

Accounting treatment of the acquisition of third party generated intangible fixed assets

UK generally accepted accounting practice (UK GAAP)

Where expenditure is incurred by a company on acquiring an intangible fixed asset within the IFA regime that has an enduring benefit for the business, the expenditure will be capitalised in the company’s balance sheet.

Where accounting standards allow, the capitalised expenditure will be written down to the

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Jurisdiction(s):
United Kingdom
Key definition:
Amortisation definition
What does Amortisation mean?

The reduction of the principal amount over time (often contrasted to a bullet repayment).

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