Corporation Tax Act 2010 section 498

Section 496(1)(d): meaning of expenditure

Section 498 clarifies what counts as "expenditure" for the purposes of the non-charitable expenditure rules in section 496(1)(d), specifying what is included and what is excluded from the definition.

• Expenditure includes spending of a capital nature, such as the acquisition of capital assets, but not capital spending that qualifies for capital allowances (as that is already accounted for elsewhere, for example in determining a trading loss).
• Investing the charitable company's own funds is not treated as expenditure for these purposes.
• Making a loan to another party is not treated as expenditure for these purposes.
• Repaying all or part of a loan that was made to the charitable company is not treated as expenditure for these purposes.