Guidance

Corporation Tax relief on goodwill and relevant assets

Find out about changes to Corporation Tax relief on goodwill and relevant assets if you're a business or tax agent.

From 1 April 2019 the Corporation Tax relief restriction rules for some acquisitions of goodwill and relevant assets changed.

What has changed

You can now get relief on purchases made on or after 1 April 2019 if the:

  • goodwill and relevant assets are purchased when you buy a business with qualifying intellectual property (IP)
  • business is liable to Corporation Tax
  • relevant assets (including goodwill) are included in the company accounts

Relief you can get

Relief is a fixed rate of 6.5% a year on the lower of the cost of the relevant asset or 6 times the cost of any qualifying IP assets in the business purchased.

Relief is given yearly until the limit is reached. More information about how to work out the relief can be found on GOV.UK in the Corporate Intangibles Research and Development Manual CIRD44093.

How to claim

You must complete a Company Tax Return and include the relief. This will reduce both:

  • your company or organisation’s taxable profit
  • the amount of Corporation Tax you have to pay

Find out how and when you can make a claim or election, and what information you need to include.

When restrictions still apply

Restrictions still apply to goodwill and relevant assets purchased:

  • without qualifying IP
  • without a business
  • from a related individual, firm or partnership which are internally-generated
  • from a related party that has been subject to a previous restriction

Get more information

Further information about restrictions for goodwill and relevant assets and purchases made before 1 April 2019 can be found on GOV.UK in the Corporate Intangibles Research and Development Manual from CIRD44000 onwards.

Published 4 June 2019