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HMRC internal manual

Lloyd's Manual

Corporate members: syndicate capacity: accounting periods ending on or after 1 April 2002: general

For accounting periods ending after 1 April 2002, the rules set out in FA02/SCH29 apply to taxation of “intangible fixed assets” (often referred to as the “IP rules”). The Corporate Intangibles Research and Development Manual (CIRD) contains a general overview of the regime and outlines its application to Lloyd’s at CIRD11750 (LLM10000).

In general, assets existing on 31 March 2002 did not come into the IP rules, but existing Lloyd’s syndicate capacity is an exception, being brought within the rules by FA02/SCH29/PARA129. The fact that syndicate capacity comes within the rules follows from the fact that it is a capital asset previously dealt with on a realisations basis (see LLM4180).


As with other companies, corporate members are entitled to a writing-down allowance where an accounting loss is recognised by way of amortisation or an impairment review.

In most cases the amount of the debit allowed will be the accounting loss shown in the accounts. For the purposes of calculating writing down allowance under paragraph 9(5), the tax written down value of the asset at the start of the first period to which the new rules apply is the accounts value at that time. This is whether or not any previous tax deductions have been given - FA02/SCH29/PARA129 (3); but as mentioned in LLM4180 no deduction was permitted for amortisation under previous law.

LLM4200 gives examples of amounts due under paragraph 9.


In the same circumstances that apply to non-Lloyd’s members, and as an alternative to a debit under paragraph 9, a corporate member may make an election under paragraph 10 to write down the asset at a fixed rate of 4% per year - see LLM4210.


For the purposes of calculating the tax adjustment on disposal (Part 4 of the Schedule), the cost to be brought into account is the original cost (FA02/SCH29/PARA27 (2)) less amounts written off under the rules. Where capacity has been written down to nil in the accounts before the rules apply, it is treated as if its nil value was a balance sheet value.

Roll-over Relief

If the capacity was acquired before the beginning of the first period to which the rules apply, it is treated as if it had been an intangible fixed asset from the date of acquisition for the purposes of Part 7 of the Schedule (Realisation and Reinvestment Relief).