# Corporation Tax Act 2010, Section 312: Qualifying pre-commencement expenditure

Extent: E+W+S+N.I.

(1) For the purposes of this Chapter, expenditure is “qualifying pre-commencement expenditure” if it meets each of conditions A to D.
(2) Condition A is that the expenditure is incurred on or after 1 January 2006.
(3) Condition B is that the expenditure is incurred in the course of oil extraction activities.
(4) Condition C is that the expenditure is incurred by a company with a view to carrying on a ring fence trade but before the company sets up and commences the ring fence trade.
(5) Condition D is that the expenditure—
(a) is subsequently allowable as a deduction in calculating the profits of the ring fence trade for the commencement period (whether or not any part of it is so allowable for any post-commencement period), or
(b) is relevant R&D expenditure incurred by an SME.
(6) For the purposes of this section, expenditure incurred by a company is “relevant R&D expenditure incurred by an SME” if—
(a) the company makes an election under section 1045 of CTA 2009 (alternative treatment for pre-trading expenditure: deemed trading loss) in respect of that expenditure, but
(b) the company does not make a claim for an R&D tax credit under section 1054 of that Act in respect of that expenditure.
(7) In the case of any qualifying pre-commencement expenditure which is relevant R&D expenditure incurred by an SME, the amount of that expenditure is treated for the purposes of this Chapter as being equal to 150% of its actual amount.
(8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

---
Source: https://www.legislation.gov.uk/ukpga/2010/4/section/312 (the official version)
Page: https://openlegislation.uk/corporation-tax-act-2010/section-312
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.