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HMRC internal manual

Business Income Manual

Change of basis of computing taxable profits: adjustment income and expenses: expenses already allowed

S234 Income Tax (Trading and Other Income) Act 2005, S183 Corporation Tax Act 2009

These special provisions apply when expenses paid by a business were allowed for tax purposes in a previous accounting period on the old basis and the treatment changes so that the expenses would be allowable on the new basis over several future accounting periods.

Without special provisions the effect of the adjustment income and expenses legislation would be to make a positive adjustment for all of this expenditure in the year of change. The special provisions say that no such adjustment should be made, but the expenses should not be deducted again.