Section 925 | How relief is given under section 924

(1)This section sets out how relief for expenses is given where a company makes a claim under section 924.

(2)The amount of the expenses must be deducted from or set off against the company's income from patents for the accounting period in which the expenses were incurred.

(3)If the amount to be allowed is greater than the amount of the company's income from patents for that accounting period, then (so long as the company remains within the charge to corporation tax) the excess must be deducted from or set off against the company's income from patents for the next accounting period, and so on for subsequent accounting periods, without the need for a further claim.

(4)In this section “income from patents” means—

(a)royalties or other sums paid in respect of the use of a patent,

(b)amounts on which tax is payable under section 912, 918 or 1272, and

(c)amounts on which tax is payable under—

(i)section 472(5) of CAA 2001 (patent allowances: balancing charges), or

(ii)paragraph 100 of Schedule 3 to that Act (balancing charges in respect of pre-1st April 1986 expenditure on purchase of patent rights),

but does not include any amount chargeable to income tax.

(5)In this section references to a company's income from patents are to the income after any allowance has been deducted from or set off against it under section 480 of CAA 2001 (certain allowances against income from patents).