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HMRC internal manual

General Insurance Manual

Taxation of general insurance: annual accounting: intangible assets

If a general insurance company incurs expenditure on an intangible fixed asset (IFA) within the meaning of FA02/SCH29, it is entitled to relief (and subject to charge) in the same way as any other trader. The IFAs which a general insurer is most likely to acquire are software and goodwill. Schedule 29 only applies to assets acquired after 1 April 2002 and then generally only when they are acquired from an unconnected company. No deduction is available under FA02/SCH29 for any element of goodwill separately identified - as required by paragraph 115 of the ABI 2005 SORP - as relating to an adjustment for the timing of payments applied in calculating the fair value of claims provisions on acquisition or for the present value of in-force business.