Section 873 — Corporation Tax Act 2009: Effect of application of section 872 in later period and subsequently

Effect of application of section 872 in later period and subsequently 873 1 A credit or debit that is required to be brought into account under section 872 is treated as arising at the beginning of the later period (“ the relevant time ”).

2 If a credit is to be brought into account, the tax written-down value of the asset at the relevant time is the sum of—

a the tax written-down value of the asset at the end of the earlier period, and b the credit.

3 If a debit is to be brought into account, the tax written-down value of the asset at the relevant time is—

a the tax written-down value of the asset at the end of the earlier period, less b the debit.

4 After the relevant time the cost recognised for tax purposes is the sum of—

a the tax written-down value given by subsection (2) or (3),

and b the cost recognised for tax purposes of any subsequent expenditure on the asset that is capitalised for accounting purposes.

5 After the relevant time the tax written-down value is determined taking account only of subsequent credits and debits.