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HMRC internal manual

Corporate Intangibles Research and Development Manual

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HM Revenue & Customs
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Reinvestment relief: general matters and conditions to be satisfied: outline of detailed guidance

CTA09/PART8 S754 - S756

Conditions to be satisfied before relief is available

Reinvestment relief is only available if:

  • a ‘chargeable intangible asset’ (including goodwill) is within CTA09/PART8 throughout the period held by a company or for a substantial part of that period (CIRD20035) is realised (CIRD13210), or
  • there is a disposal of another intangible asset (including goodwill) leading to a gain within the CG code (CIRD20050), and
  • the realisation of the asset:

 

  • generates net proceeds which exceed the cost of that asset (or a proportionate part of that cost where the asset is only partly realised) (CIRD20060), and
  • is an actual realisation not a deemed realisation (CIRD20070) (though this rule is relaxed for certain deemed realisations in the context of degrouping - see CIRD20460),
  • does not arise on a part realisation to a related party - see CIRD20080 (this restriction does not apply to the part disposal of assets within the CG code),
     

 

  • the investment in the ‘new’ assets:

 

  • is made within the permitted period (CIRD20110), and
  • takes the form of expenditure which is capitalised in the company’s accounts (CIRD20120),
  • is in assets which are within CTA09/PART8 immediately after the expenditure is incurred (CIRD20130), and
  • is a real investment in a new asset and not a deemed acquisition or reacquisition (though the actual reacquisition of the asset realised qualifies) (CIRD20140), and
     

 

  • a valid claim to the relief is made (CIRD20150).

Computation

See CIRD20200 onwards for the computation of the relief where the conditions set out above are satisfied.

Provisional relief

Provisional relief is possible under the procedure described in CIRD20015.

Comparison with CG roll-over relief

See CIRD20025 for a summary of points of similarity and difference between the two reliefs.