Section 879M | When the partial restrictions apply: qualifying IP assets ^F1

From legislation.gov.uk

1 April 2026

(1)Section 879O (the partial restrictions on debits) applies in respect of a relevant asset (“the asset concerned”) of a company if—^F1

(a)the company acquires the asset concerned on or after 1 April 2019 as part of the acquisition of a business,^F1

(b)the company also acquires qualifying IP assets as part of the acquisition of the business for use on a continuing basis in the course of the business, and^F1

(c)the amount in subsection (3) is less than 1.^F1

(2)But section 879O does not apply in respect of the asset concerned if either of the following sections applies in respect of it—^F1

(a)section 879C (restrictions on debits: pre-FA 2019 relevant assets);^F1

(b)section 879K (restrictions on debits: acquisition from individual or firm).^F1

(3)The amount is—^F1

Formula

\frac{A \times N}{B}

where—

A is the expenditure incurred by the company for or in connection with the acquisition of the qualifying IP assets mentioned in subsection (1)(b),

B is the expenditure incurred by the company for or in connection with the acquisition of the asset concerned and any other relevant assets acquired with the business, and

N is 6.

(4)The Treasury may by regulations amend the meaning of N.^F1

(5)In this section—^F1

“expenditure” means expenditure that is—subject to any adjustments under this Part or Part 4 of TIOPA 2010;

(a)capitalised for accounting purposes, or

(b)recognised in determining the profit or loss of the company concerned without being capitalised for accounting purposes,

“qualifying IP asset” has the same meaning as in section 879I (see section 879J).