Finance Act 2006

Section 28

SCHEDULE 2U.K.Relief for research and development: subjects of clinical trials

Amendments to Schedule 20 to FA 2000U.K.

1(1)Schedule 20 to FA 2000 (tax relief for expenditure on research and development by small or medium-sized enterprises) is amended as follows.U.K.

(2)In paragraph 3 (qualifying R&D expenditure), in sub-paragraph (4), after paragraph (b) insert—

“(ba)is incurred on relevant payments to the subjects of a clinical trial (see paragraph 6A),”.

(3)After paragraph 6 (expenditure on software or consumable items), insert—

“Relevant payments to subjects of clinical trialsU.K.

6A(1)For the purposes of this Schedule “relevant payment”, in relation to a subject of a clinical trial, means a payment made to him for participating in the trial.

(2)For the purposes of this Schedule “clinical trial” means an investigation in human subjects undertaken in connection with the development of a health care treatment or procedure.”

(4)In paragraph 10 (treatment of expenditure where company and sub-contractor are connected persons), in sub-paragraph (2)(a)(iii), for “or on software or consumable items” substitute “ , on software or consumable items or on relevant payments to the subjects of a clinical trial ”.

Amendments to Schedule 12 to FA 2002U.K.

2(1)Schedule 12 to FA 2002 (tax relief for expenditure on research and development: large companies etc) is amended as follows.U.K.

(2)In paragraph 4 (qualifying expenditure on direct research and development), in sub-paragraph (3)—

(a)omit the word “or” at the end of paragraph (b);

(b)after that paragraph insert—

“(ba)is incurred on relevant payments to the subjects of a clinical trial, or”.

(3)In paragraph 9 (expenditure on research and development directly undertaken by the SME), in sub-paragraph (2)—

(a)omit the word “or” at the end of paragraph (b);

(b)after that paragraph insert—

“(ba)is incurred on relevant payments to the subjects of a clinical trial, or”.

(4)In paragraph 17 (which applies certain definitions from Schedule 20 to FA 2000)—

(a)in the heading, after “ “software or consumable items”” insert “ , “relevant payments to the subjects of a clinical trial” ”;

(b)omit the word “and” at the end of paragraph (c);

(c)after that paragraph insert—

“(ca)paragraph 6A (relevant payments to subjects of clinical trials); and”.

Amendments to Schedule 13 to FA 2002U.K.

3(1)Schedule 13 to FA 2002 (tax relief for expenditure on vaccine research etc) is amended as follows.U.K.

(2)In paragraph 3 (qualifying expenditure on direct research and development), in sub-paragraph (5)—

(a)omit the word “or” at the end of paragraph (b);

(b)after that paragraph insert—

“(ba)is incurred on relevant payments to the subjects of a clinical trial, or”.

(3)In paragraph 5 (which applies certain definitions from Schedule 20 to FA 2000)—

(a)in the heading, after “ “software or consumable items”,” insert “ “relevant payments to the subjects of a clinical trial”, ”;

(b)in sub-paragraph (3), after paragraph (c) insert—

“(ca)paragraph 6A (relevant payments to subjects of clinical trials);”.

(4)In paragraph 9 (relevant expenditure of the sub-contractor), in sub-paragraph (3)—

(a)omit the word “or” at the end of paragraph (b);

(b)after that paragraph insert—

“(ba)is incurred on relevant payments to the subjects of a clinical trial, or”.