Revenue Note for Guidance

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Revenue Note for Guidance

769L Documentation

Summary

In order to be in a position to make a claim under this Chapter, the company must have tracked and traced all expenditure and income and linked those to the qualifying asset.

Details

(1)(a) A relevant company that claims relief under this Chapter must have available such records as may reasonably be required to determine whether the qualifying profits has been computed in accordance with this Chapter.

(b) The records must demonstrate that each of the following had been tracked-

  1. overall income from the qualifying asset,
  2. qualifying expenditure on the qualifying asset and
  3. overall expenditure on the qualifying asset

The documentation must also demonstrate how those expenditures and income are linked to the qualifying asset.

(c) An additional documentation requirement is placed on a company which is applying the Chapter to a family of assets. Those companies must also have records that support the reasonableness of the ‘family’ that they chose. Where relevant, they must have records that support

  1. the commonality of scientific, technological or engineering challenges underlying the research and development activities which were undertaken and which resulted in the qualifying assets;
  2. the consistency of the chosen method of grouping with the organisation of research and development activities carried on by the relevant company;
  3. the creation of a nexus between expenditures and a family of assets; or
  4. the choice of a family of assets with which to create that nexus.

(d) An additional documentation requirement is placed on a company which is claiming relief in respect of a derivative work or an adaptation. These companies must also have records which:

  1. identify the original work and the derivation or adaptation therefrom,
  2. the costs associated with both the original work and the derivative work or the adaptation, and
  3. support any method of apportionment of income between the original work and the derivative work or adaptation.

(2) These tracking and tracing requirements do not apply to expenditures incurred prior to 1 January 2016.

(3) The documents must be prepared on a timely basis and the obligations in section 886 to keep and retain records and linking documents apply to these documents.

(4) The documentation must be kept for a period of 6 years from the end of the accounting period in which the return for the last accounting period in which that asset was a qualifying asset is filed.

(5) A Revenue officer may require a relevant company to furnish the officer with such information or particulars as may be necessary for the purposes of giving effect to this Chapter.

(6) Revenue may make regulations for the purposes of enabling a company fulfil its obligations under this Section or to facilitate the operation of the Chapter in an efficient manner

(7) Failure to have the documentation required under this Section available will result in a company not being a relevant company and not being entitled to claim relief under this Chapter.

Relevant Date: Finance Act 2021