CIRD11530 - Intangible assets within CTA09/PART8: FA02 rule: Step guides
Step guide A: Intangibles – FA02 Rule: Acquired Assets
Do not use if any of the exceptions listed in CTA09/S882(5D) apply (see CIRD11520).
Apply the rules in step by step guide C to establish if and when an asset is created for the purposes of CTA09/PART8.
See also step by step guide C for when expenditure is incurred.
Step 1
Was acquisition expenditure incurred by the company on or after 1 July 2020? [Note: The answer to this question is ‘no’ if no expenditure is incurred]
If yes, the asset is a Part 8 asset.
If no, go to Step 2.
Step 2
Was acquisition expenditure incurred by the company between 1 April 2002 and 30 June 2020? [Note: The answer to this question is ‘no’ if no expenditure is incurred]
If yes, go to step 3.
If no, the asset is a pre-FA02 asset (not covered by this guide).
Step 3
Was the asset acquired from an unrelated party? (see CIRD11610)
If yes, the asset is a Part 8 asset.
If no, go to step 4.
Step 4
Is the asset a chargeable intangible asset in the hands of the related party? (see CIRD11630)
If yes, the asset is a Part 8 asset.
If no, go to Step 5.
Step 5
Was the asset previously acquired in qualifying circumstances? (See CIRD11640)
If yes, the asset is a Part 8 asset.
If no, go to step 6.
Step 6
Was the asset created (by anybody) on or after 1 April 2002? (see CIRD11650)
If yes, the asset is a Part 8 asset.
If no, the asset is a pre-FA2002 asset.
Step guide B: Intangibles – FA02 Rule: Assets created by company
Step 1
Was the expenditure incurred after commencement on ‘creation’ of goodwill, or expenditure of a type not qualifying for capital allowances incurred on ‘creating’ an asset?
If yes go to step 2.
If no go to step 3.
Step 2
Business carried on (goodwill) or other asset held by company pre-1 April 2002? See CIRD11680/11685
If yes the asset is a pre-FA2002 asset.
If no the asset is a Part 8 asset.
Step 3
Another type of expenditure incurred after commencement on ‘creation’ of an asset? See CIRD11600.
If yes the asset is a Part 8 asset.
If no this is a pre-FA2002 asset.
Notes:
Step guide C will explain when expenditure incurred (or treated as incurred).
If expenditure on creation is also incurred before commencement treat blocks of expenditure as separate assets.
Step guide C: Intangibles – FA02 Rule: Supplementary step guide when expenditure on creation or acquisition of an asset ‘incurred’
Step 1
Would the expenditure have qualified for capital allowances apart from Part 8?
If yes expenditure is incurred when unconditional obligation to pay it arises - see CIRD11675 and CIRD11690.
If no go to step 2.
Step 2
Was the expenditure on the acquisition of the asset?
If yes go to step 3.
If no, if expenditure is on creation the asset will fall within CIRD11680 and CIRD11685 and when expenditure incurred will be irrelevant.
Step 3
Would the expenditure have qualified for any form of tax relief against income apart from Part 8?
If yes expenditure incurred when recognised under GAAP see CIRD11690.
If no, go to step 4.
Step 4
Would the acquisition have been recognised under the rule in TCGA92/S28 as taking place before 1 April 2002?
If yes, expenditure incurred before 1 April 2002 - see CIRD11690.
If no, expenditure incurred when recognised under GAAP see CIRD11690.