Taxes Consolidation Act 1997 section 769M

Anti-avoidance

Section 769M is an anti-avoidance provision ensuring that only genuinely commercial income and expenditure qualify for Knowledge Development Box (KDB) relief.

• Qualifying expenditure on a qualifying asset must be incurred for bona fide commercial purposes to be included in a KDB claim.
• Overall income from a qualifying asset must likewise be received for bona fide commercial purposes.
• Any amount that forms part of a scheme or arrangement whose main purpose, or one of whose main purposes, is the avoidance of tax is excluded from both qualifying expenditure and overall income.
• The provision applies to both the expenditure and income sides of the KDB formula, preventing artificial inflation of the relief in either direction.