Corporate intangibles tax treatment

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Corporation Tax

Guidance

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Tax treatment of intangibles

The basic rule is that the tax treatment of qualifying intangible fixed assets acquired or created on or after 1 April 2002 broadly follows the accounting treatment under generally accepted accounting practice (GAAP) (see below). This includes amortisation, royalties paid and received, revaluations, and reversals of previous gains and losses. Therefore, for trading intangible assets, the debits and credits in the financial statements will not need to be adjusted in the corporation tax computation. However, major restrictions apply for debits relating to goodwill and customer-related intangible assets depending on the date they were acquired or created, see the Goodwill and other customer-related intangible assets guidance note.

Where an asset was acquired or created before 1 April 2002, it is referred to as a ‘pre-FA 2002 asset’. Prior to 1 July 2020, pre-FA 2002 assets did not come within the scope of the corporate intangibles regime and instead were (in most cases) dealt with under the capital gains regime. However, for acquisitions made on or after 1 July 2020, any intangible asset acquired by

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Anne Fairpo

Barrister

With effect from 1 June 2021, Anne Fairpo is a judge of the First-tier Tribunal sitting in the Tax Chamber. She was previously a fee-paid judge in the same Chamber. Her contributions to LexisPSL Tax and TolleyGuidance were written before her full-time appointment and are her personal view as she is not authorised to write on behalf of the Tribunals Service or the judiciary. Until April 2021, Anne was a tenant at Temple Tax Chambers. She was called to the bar in 2009 after 15 years as a solicitor. Anne’s experience and expertise covers UK and international corporate tax planning and disputes, having acted for a range of clients from small owner-managed businesses to listed multinationals, as well as having advised on intellectual property taxation and UK-US cross-border tax planning, with regard to both direct and indirect tax matters

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