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HMRC internal manual

Corporate Intangibles Research and Development Manual

Reinvestment relief: general matters and conditions to be satisfied: introduction



Reinvestment relief is a form of roll-over relief, enabling the whole or (more usually) a part of a taxable credit arising on the realisation of an intangible asset, including goodwill, to be deferred. (See CIRD13210 onwards for the computation of the credit before any reinvestment relief is given).

The relief works by deducting the same amount from the realisation proceeds and from the company’s expenditure on other intangible assets within CTA09/PART8, thereby reducing the deductible debits:

  • for sums written off those assets by way of amortisation or impairment (CIRD12700),
  • to be taken into account in calculating the taxable credit or deductible debit on the realisation of those assets.

Points to note:

  • that part of a taxable credit which represents the recovery of amortisation or impairment deductions cannot be relieved,
  • relief is further restricted where not all the net proceeds from the asset are re-invested,
  • Interaction with CG roll-over relief.

CG on the disposal of goodwill and intangible assets on or after 1 April 2002 (outside CTA09/PART8 by virtue of the time test described at CIRD11500 onwards) may also be rolled over against expenditure on assets within CTA09/PART8, see CIRD20050.

CG roll-over relief ceases to be available:

  • to defer gains on the disposal of goodwill (and the various types of agricultural and fishing quota within TCGA92/S155 - see CG60430) on or after 1 April 2002 against the acquisition of new assets (tangible or intangible) after that date, and
  • to defer gains on the disposal at any time of any asset (tangible or intangible) by virtue of replacement assets that qualify as ‘chargeable intangible assets’ within CTA09/PART8 (see CIRD20035).

See CIRD20070.

Groups of companies

The availability of relief is extended in the case of groups of companies - see CIRD20400 onwards.

The relief is not available where a taxable credit arises on the part realisation of anasset if the person acquiring the interest in the asset is a related party, see CIRD20080.