Corporation Tax Act 2009 section 87

Expenses of research and development

Section 87 provides a tax deduction for revenue expenses incurred on research and development carried out by or on behalf of a trading company.

• Revenue expenses on R&D related to a company's trade are deductible when the R&D is directly undertaken by or on behalf of the company
• Qualifying expenses include all costs of carrying out R&D or providing facilities for it, but exclude the cost of acquiring rights in or arising from someone else's R&D
• "Related to the trade" is interpreted broadly, covering R&D that may extend the trade and medical research benefiting the welfare of workers in the trade
• The same expenses cannot be claimed against more than one trade, and the definition of R&D includes oil and gas exploration and appraisal