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Royal ArmsCapital Allowances Act 2001

2001 Chapter 2


 

© Crown Copyright 2001

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Capital Allowances Act 2001

2001 Chapter 2

 
 
 
CONTENTS

PART 1
INTRODUCTION
CHAPTER 1
CAPITAL ALLOWANCES: GENERAL
Section 
1Capital allowances
2General means of giving effect to capital allowances
3Claims for capital allowances
4Capital expenditure
5When capital expenditure is incurred
6Meaning of "chargeable period"

CHAPTER 2
EXCLUSION OF DOUBLE RELIEF
7No double allowances
8No double relief through pooling under Part 2 (plant and machinery allowances)
9Interaction between fixtures claims and other claims
10Interpretation

PART 2
PLANT AND MACHINERY ALLOWANCES
CHAPTER 1
INTRODUCTION
11General conditions as to availability of plant and machinery allowances
12Expenditure incurred before qualifying activity carried on
13Use for qualifying activity of plant or machinery provided for other purposes
14Use for qualifying activity of plant or machinery which is a gift

CHAPTER 2
QUALIFYING ACTIVITIES
15Qualifying activities
16Ordinary Schedule A businesses
17Furnished holiday lettings businesses
18Management of investment companies
19Special leasing of plant or machinery
20Employments and offices

CHAPTER 3
QUALIFYING EXPENDITURE
Buildings, structures and land
21Buildings
22Structures, assets and works
23Expenditure unaffected by sections 21 and 22
24Interests in land
25Building alterations connected with installation of plant or machinery

Demolition costs
26Demolition costs

Expenditure on thermal insulation, safety measures, etc.
27Application of Part to thermal insulation, safety measures, etc.
28Thermal insulation of industrial buildings
29Fire safety
30Safety at designated sports grounds
31Safety at regulated stands at sports grounds
32Safety at other sports grounds
33Personal security

Exclusion of certain types of expenditure
34Expenditure by MPs and others on accommodation
35Expenditure on plant or machinery for use in dwelling-house not qualifying expenditure in certain cases
36Restriction on qualifying expenditure in case of employment or office
37Exclusion where sums payable in respect of depreciation
38Production animals etc.

CHAPTER 4
FIRST-YEAR QUALIFYING EXPENDITURE
General
39First-year allowances available for certain types of qualifying expenditure only

Types of expenditure which may qualify for first-year allowances
40Expenditure incurred for Northern Ireland purposes by small or medium-sized enterprises
41Miscellaneous exclusions from section 40 (expenditure for Northern Ireland purposes etc.)
42Exclusion of plant or machinery partly for use outside Northern Ireland
43Effect of plant or machinery subsequently being primarily for use outside Northern Ireland
44Expenditure incurred by small or medium-sized enterprises
45ICT expenditure incurred by small enterprises
46General exclusions applying to sections 40, 44 and 45

Expenditure of small or medium-sized enterprises
47Expenditure of small or medium-sized enterprises: companies
48Expenditure of small or medium-sized enterprises: businesses
49Whether company is a member of a large or medium-sized group

Supplementary
50Time when expenditure is incurred
51Disclosure of information between UK tax authorities

CHAPTER 5
ALLOWANCES AND CHARGES
First-year allowances
52First-year allowances

Pooling
53Pooling of qualifying expenditure
54The different kinds of pools

Writing-down and balancing allowances and balancing charges
55Determination of entitlement or liability
56Amount of allowances and charges

Available qualifying expenditure
57Available qualifying expenditure
58Initial allocation of qualifying expenditure to pools
59Unrelieved qualifying expenditure

Disposal events and disposal values: general
60Meaning of "disposal receipt" and "disposal event"
61Disposal events and disposal values
62General limit on amount of disposal value
63Cases in which disposal value is nil
64Case in which no disposal value need be brought into account

The final chargeable period
65The final chargeable period

List of provisions outside this Chapter about disposal values
66List of provisions outside this Chapter about disposal values

CHAPTER 6
HIRE-PURCHASE ETC. AND PLANT OR MACHINERY PROVIDED BY LESSEE
Hire-purchase and similar contracts
67Plant or machinery treated as owned by person entitled to benefit of contract, etc.
68Disposal value on cessation of notional ownership
69Hire-purchase etc. and fixtures

Plant or machinery provided by lessee
70Plant or machinery provided by lessee

CHAPTER 7
COMPUTER SOFTWARE
71Software and rights to software
72Disposal values
73Limit on disposal values

CHAPTER 8
CARS, ETC.
Cars above the cost threshold
74Single asset pool
75General limit on amount of writing-down allowance
76Limit where part of expenditure met by another person
77Car used partly for purposes other than those of qualifying activity
78Effect of partial depreciation subsidy
79Cases where Chapter 17 (anti-avoidance) applies

Vehicles provided for purposes of employment or office
80Vehicles provided for purposes of employment or office

Interpretation
81Extended meaning of "car"
82Qualifying hire cars

CHAPTER 9
SHORT-LIFE ASSETS
83Meaning of "short-life asset"
84Cases in which short-life asset treatment is ruled out
85Election for short-life asset treatment: procedure
86Short-life asset pool
87Short-life assets provided for leasing
88Sales at under-value
89Disposal to connected person

CHAPTER 10
LONG-LIFE ASSETS
Long-life asset expenditure
90Long-life asset expenditure
91Meaning of "long-life asset"
92Application of Chapter to part of expenditure

Expenditure excluded from being long-life asset expenditure
93Fixtures etc.
94Ships
95Railway assets
96Cars
97Expenditure within the relevant monetary limit: general
98Expenditure to which the monetary limits apply
99The monetary limit
100Exceeding the monetary limit

Rules applying to long-life asset expenditure
101Long-life asset pool
102Writing-down allowances at 6%

Anti-avoidance provisions
103Later claims
104Disposal value of long-life assets

CHAPTER 11
OVERSEAS LEASING
Basic terms
105"Leasing", "overseas leasing" etc.
106The designated period

Certain expenditure to be pooled
107The overseas leasing pool
108Effect of disposal to connected person on overseas leasing pool

Allowances reduced or, in certain cases, prohibited
109Writing-down allowances at 10%
110Cases where allowances are prohibited

Recovery of excess allowances
111Excess allowances: standard recovery mechanism
112Excess allowances: connected persons
113Excess allowances: special provision for ships

Recovery of allowances given in cases where prohibition applies
114Prohibited allowances: standard recovery mechanism
115Prohibited allowances: connected persons

Application of Chapter in relation to joint lessees
116Mitigation of regime
117Recovery of allowances in case of joint lessees

Duties to supply information
118Certificate relating to protected leasing
119Notice of change of use of plant or machinery
120Notice and joint lessees

Qualifying purposes
121Meaning of "short-term leasing"
122Short-term leasing by buyer, lessee, etc.
123Ships and aircraft
124Transport containers
125Other qualifying purposes

Minor definitions
126Minor definitions

CHAPTER 12
SHIPS
Pooling and postponement of allowances
127Single ship pool
128Expenditure which is not to be allocated to single ship pool
129Election to use the appropriate non-ship pool
130Notice postponing first-year or writing-down allowance
131Effect of postponement
132Disposal events and single ship pool
133Ship not used

Deferment of balancing charges
134Deferment of balancing charges: introduction
135Claim for deferment
136Further conditions for deferment
137Effect of deferment
138Limit on amount deferred
139Amount taken into account in respect of old ship

Attribution of deferred amounts
140Notice attributing deferred amounts to new expenditure
141Deferred amounts attributed to earlier expenditure first
142Variation of attribution
143Effect of attribution
144Amounts which cease to be attributable
145Requirement to notify where no entitlement to defer amounts

Expenditure on new shipping
146Basic meaning of expenditure on new shipping
147Exclusions: ship previously owned
148Exclusions: object to secure deferment
149Exclusions: later events
150Exclusions where expenditure not incurred by shipowner

Qualifying ships
151Basic meaning of qualifying ship
152Ships under 100 tons
153Ships which are not qualifying ships
154Further registration requirement

Deferment of balancing charges: supplementary provisions
155Change in the persons carrying on the qualifying activity
156Connected persons

Further provisions
157Adjustment of assessments etc.
158Members of same group

CHAPTER 13
PROVISIONS AFFECTING MINING AND OIL INDUSTRIES
Expenditure connected with mineral extraction trades
159Meaning of "mineral extraction trade" etc.
160Expenditure treated as incurred for purposes of mineral extraction trade
161Pre-trading expenditure on mineral exploration and access

Provisions relating to ring fence trades
162Ring fence trade a separate qualifying activity
163Meaning of "abandonment expenditure"
164Abandonment expenditure incurred before cessation of ring fence trade
165Abandonment expenditure within 3 years of ceasing ring fence trade

Transfers of interests in oil fields: anti-avoidance
166Transfers of interests in oil fields: anti-avoidance

Oil production sharing contracts
167Oil production sharing contracts
168Expenditure on plant or machinery incurred by contractor
169Expenditure on plant or machinery incurred by participator
170Participator's expenditure attributable to plant or machinery
171Disposal values on cessation of ownership

CHAPTER 14
FIXTURES
Introduction
172Scope of Chapter etc.
173Meaning of "fixture" and "relevant land"
174Meaning of "equipment lease" and "lease"
175Meaning of "interest in land", etc.

Persons who are treated as owners of fixtures
176Person with interest in relevant land having fixture for purposes of qualifying activity
177Equipment lessors
178Equipment lessee has qualifying activity etc.
179Equipment lessor has right to sever fixture that is not part of building
180Equipment lease is part of affordable warmth programme
181Purchaser of land giving consideration for fixture
182Purchaser of land discharging obligations of equipment lessee
183Incoming lessee where lessor entitled to allowances
184Incoming lessee where lessor not entitled to allowances

Restrictions on amount of qualifying expenditure
185Fixture on which a plant and machinery allowance has been claimed
186Fixture on which an industrial buildings allowance has been made
187Fixture on which a research and development allowance has been made

Cessation of ownership of fixtures
188Cessation of ownership when person ceases to have qualifying interest
189Identifying the qualifying interest in special cases
190Cessation of ownership of lessor where section 183 applies
191Cessation of ownership on severance of fixture
192Cessation of ownership of equipment lessor

Acquisition of ownership of fixture when another ceases to own it
193Acquisition of ownership by lessor or licensor on termination of lease or licence
194Acquisition of ownership by assignee of equipment lessor
195Acquisition of ownership by equipment lessee

Disposal values
196Disposal values in relation to fixtures: general
197Disposal values in avoidance cases

Election to fix apportionment
198Election to apportion sale price on sale of qualifying interest
199Election to apportion capital sum given by lessee on grant of lease
200Elections under sections 198 and 199: supplementary
201Elections under sections 198 and 199: procedure

Further provisions
202Interpretation
203Amendment of returns etc.
204Appeals etc.

CHAPTER 15
ASSET PROVIDED OR USED ONLY PARTLY FOR QUALIFYING ACTIVITY
205Reduction of first-year allowances
206Single asset pool etc.
207Reduction of allowances and charges on expenditure in single asset pool
208Effect of significant reduction in use for purposes of qualifying activity

CHAPTER 16
PARTIAL DEPRECIATION SUBSIDIES
209Meaning of "partial depreciation subsidy"
210Reduction of first-year allowances
211Single asset pool etc.
212Reduction of allowances and charges on expenditure in single asset pool

CHAPTER 17
ANTI-AVOIDANCE
Relevant transactions
213Relevant transactions: sale, hire-purchase (etc.) and assignment

Restrictions on allowances
214Connected persons
215Transactions to obtain allowances
216Sale and leaseback, etc.
217No first-year allowance for B's expenditure
218Restriction on B's qualifying expenditure

Finance leases
219Meaning of "finance lease"
220Allocation of expenditure to a chargeable period

Sale and finance leasebacks
221Meaning of "sale and finance leaseback"
222Disposal value restricted
223No first-year allowance for B's expenditure
224Restriction on B's qualifying expenditure
225B's qualifying expenditure if lessor not bearing non-compliance risk
226Qualifying expenditure limited in subsequent transactions

Sale and leaseback or sale and finance leaseback: election for special treatment
227Circumstances in which election may be made
228Effect of election: relaxation of restriction on B's qualifying expenditure, etc.

Miscellaneous and supplementary
229Hire-purchase etc.
230Exception for manufacturers and suppliers
231Adjustments of assessments etc.
232Meaning of connected person
233Additional VAT liabilities and rebates

CHAPTER 18
ADDITIONAL VAT LIABILITIES AND REBATES
Introduction
234Introduction

Additional VAT liability
235Additional VAT liability treated as qualifying expenditure
236Additional VAT liability generates first-year allowance
237Exceptions to section 236

Additional VAT rebate
238Additional VAT rebate generates disposal value
239Limit on disposal value where additional VAT rebate

Short-life assets: balancing allowance
240Additional VAT liability

Anti-avoidance
241No first-year allowance in respect of additional VAT liability
242Restriction on B's qualifying expenditure: general
243Restriction on B's qualifying expenditure: sale and finance leaseback
244B's qualifying expenditure if lessor not bearing non-compliance risk
245Effect of election under section 227 on additional VAT liability
246Miscellaneous

CHAPTER 19
GIVING EFFECT TO ALLOWANCES AND CHARGES
Trades
247Trades

Property businesses
248Ordinary Schedule A businesses
249Furnished holiday lettings businesses
250Overseas property businesses

Activities analogous to trades
251Professions and vocations
252Mines, transport undertakings etc.

Investment companies
253Investment companies

Life assurance business
254Introductory
255Apportionment of allowances and charges
256Different giving effect rules for different categories of business
257Supplementary

Special leasing of plant or machinery
258Special leasing: income tax
259Special leasing: corporation tax (general)
260Special leasing: corporation tax (excess allowance)
261Special leasing: life assurance business

Employments and offices
262Employments and offices

CHAPTER 20
SUPPLEMENTARY PROVISIONS
Partnerships and successions
263Qualifying activities carried on in partnership
264Partnership using property of a partner
265Successions: general
266Election where predecessor and successor are connected persons
267Effect of election
268Successions by beneficiaries

Miscellaneous
269Use of plant or machinery for business entertainment
270Shares in plant or machinery

PART 3
INDUSTRIAL BUILDINGS ALLOWANCES
CHAPTER 1
INTRODUCTION
271Industrial buildings allowances
272Expenditure on the construction of a building
273Preparation of sites for plant or machinery

CHAPTER 2
INDUSTRIAL BUILDINGS
Buildings in use for the purposes of a qualifying trade
274Trades and undertakings which are "qualifying trades"
275Building used for welfare of workers
276Parts of trades and undertakings
277Exclusion of dwelling-houses, retail shops, showrooms, hotels and offices etc.
278Building used by more than one licensee

Qualifying hotels and sports pavilions
279Qualifying hotels
280Qualifying sports pavilions

Commercial buildings (enterprise zones)
281Commercial buildings (enterprise zones)

Supplementary provisions
282Buildings outside the United Kingdom
283Non-industrial part of building disregarded
284Roads on industrial estates etc.
285Cessation of use and temporary disuse of building

CHAPTER 3
THE RELEVANT INTEREST IN THE BUILDING
286General rule as to what is the relevant interest
287Interest acquired on completion of construction
288Effect of creation of subordinate interest
289Merger of leasehold interest
290Election to treat grant of lease exceeding 50 years as sale
291Supplementary provisions with respect to elections

CHAPTER 4
QUALIFYING EXPENDITURE
Introduction
292Meaning of "qualifying expenditure"
293Meaning of references to carrying on a trade as a developer

Qualifying expenditure
294Capital expenditure on construction of a building
295Purchase of unused building where developer not involved
296Purchase of building which has been sold unused by developer
297Purchase of used building from developer

Qualifying enterprise zone expenditure
298The time limit for qualifying enterprise zone expenditure
299Application of section 294
300Application of sections 295 and 296
301Purchase of building within 2 years of first use

Part of expenditure within time limit for qualifying enterprise zone expenditure
302Qualifying enterprise zone expenditure where section 295 or 296 applies
303Purchase of building within 2 years of first use
304Application of section 303 where developer involved

CHAPTER 5
INITIAL ALLOWANCES
305Initial allowances for qualifying enterprise zone expenditure
306Amount of initial allowance and period for which allowance made
307Building not industrial building when first used etc.
308Grants affecting entitlement to initial allowances

CHAPTER 6
WRITING-DOWN ALLOWANCES
309Entitlement to writing-down allowance
310Basic rule for calculating amount of allowance
311Calculation of allowance after sale of relevant interest
312Allowance limited to residue of qualifying expenditure
313Meaning of "the residue of qualifying expenditure"

CHAPTER 7
BALANCING ADJUSTMENTS
General
314When balancing adjustments are made
315Main balancing events
316Proceeds from main balancing events
317Balancing event where hotel not qualifying hotel for 2 years

Calculation of balancing adjustments
318Building an industrial building etc. throughout
319Building not an industrial building etc. throughout
320Overall limit on balancing charge

Meaning of "the relevant period of ownership" etc.
321The relevant period of ownership
322Starting expenditure
323Adjusted net cost
324Net allowances

Balancing allowances restricted where sale subject to subordinate interest
325Balancing allowances restricted where sale subject to subordinate interest
326Interpretation of section 325

Qualifying enterprise zone expenditure: effect of realising capital value
327Capital value provisions: application of provisions
328Balancing adjustment on realisation of capital value
329Capital value that is attributable to subordinate interest
330Exception for payments more than 7 years after agreement
331Capital value provisions: interpretation

CHAPTER 8
WRITING OFF QUALIFYING EXPENDITURE
332Introduction
333Writing off initial allowances
334Writing off writing-down allowances
335Writing off research and development allowances
336Writing off expenditure when building not an industrial building
337Writing off or increase of expenditure where balancing adjustment made
338Writing off capital value which has been realised
339Crown or other person not within the charge to tax entitled to the relevant interest
340Treatment of demolition costs

CHAPTER 9
HIGHWAY UNDERTAKINGS
341Carrying on of highway undertakings
342The relevant interest
343Balancing adjustment on ending of concession
344Cases where highway concession is to be treated as extended

CHAPTER 10
ADDITIONAL VAT LIABILITIES AND REBATES
Introduction
345Introduction

Additional VAT liabilities
346Additional VAT liabilities and initial allowances
347Additional VAT liabilities and writing-down allowances
348Additional VAT liabilities and writing off initial allowances

Additional VAT rebates
349Additional VAT rebates and writing-down allowances
350Additional VAT rebates and balancing adjustments
351Additional VAT rebates and writing off qualifying expenditure

CHAPTER 11
GIVING EFFECT TO ALLOWANCES AND CHARGES
352Trades
353Lessors and licensors
354Buildings temporarily out of use
355Buildings for miners etc.: carry-back of balancing allowances

CHAPTER 12
SUPPLEMENTARY PROVISIONS
356Apportionment of sums partly referable to non-qualifying assets
357Arrangements having an artificial effect on pricing
358Requisitioned land
359Provisions applying on termination of lease
360Meaning of "lease" etc.

PART 4
AGRICULTURAL BUILDINGS ALLOWANCES
CHAPTER 1
INTRODUCTION
361Agricultural buildings allowances
362Meaning of "husbandry"
363Expenditure on the construction of a building

CHAPTER 2
THE RELEVANT INTEREST
364General rule as to what is the relevant interest
365Effect of creation of subordinate lease
366Interest conveyed or assigned by way of security
367Merger of leasehold interest
368Provisions applying on ending of lease

CHAPTER 3
QUALIFYING EXPENDITURE
369Capital expenditure on construction of agricultural building
370Purchase of relevant interest before first use of agricultural building
371Different relevant interests in different parts of the related agricultural land

CHAPTER 4
WRITING-DOWN ALLOWANCES
372Entitlement to writing-down allowance
373Basic rule for calculating amount of allowance
374First use of building not for purposes of husbandry, etc.
375Effect of acquisition of relevant interest after first use of building
376Calculation of allowance after acquisition
377Chargeable period when balancing adjustment made
378Allowance limited to residue of qualifying expenditure
379Final writing-down allowance

CHAPTER 5
BALANCING ADJUSTMENTS
General
380When balancing adjustments are made
381Balancing events (on making an election)
382Requirements as to elections
383Proceeds from balancing events
384Exclusion of proportion of proceeds

Calculation of balancing adjustments
385Calculation of balancing adjustment
386The residue of qualifying expenditure
387Overall limit on balancing charge
388Acquisition of relevant interest in part of land, etc.
389Balancing allowances restricted where sale subject to subordinate interest etc.
390Interpretation of section 389

CHAPTER 6
SUPPLEMENTARY PROVISIONS
Giving effect to allowances and charges
391Trades
392Schedule A businesses

Meaning of "freehold interest", "lease" etc.
393Meaning of "freehold interest", "lease", etc.

PART 5
MINERAL EXTRACTION ALLOWANCES
CHAPTER 1
INTRODUCTION
394Mineral extraction allowances
395Qualifying expenditure
396Meaning of "mineral exploration and access"
397Meaning of "mineral asset"
398Relationship between main types of qualifying expenditure
399Expenditure excluded from being qualifying expenditure

CHAPTER 2
QUALIFYING EXPENDITURE ON MINERAL EXPLORATION AND ACCESS
400Qualifying expenditure on mineral exploration and access
401Pre-trading exploration expenditure
402Pre-trading expenditure on plant or machinery

CHAPTER 3
QUALIFYING EXPENDITURE ON ACQUIRING A MINERAL ASSET
403Qualifying expenditure on acquiring a mineral asset
404Exclusion of undeveloped market value of land
405Qualifying expenditure where buildings or structures cease to be used
406Reduction where premium relief previously allowed

CHAPTER 4
QUALIFYING EXPENDITURE: SECOND-HAND ASSETS
Assets reflecting expenditure on mineral exploration and access
407Acquisition of mineral asset owned by previous trader
408Acquisition of oil licence from non-trader
409Acquisition of other assets from non-traders

Qualifying expenditure on assets limited by reference to historic costs
410UK oil licence: limit is original licence payment
411Assets generally: limit is residue of previous trader's qualifying expenditure
412Transfers of mineral assets within group: limit is initial group expenditure
413Transfers of mineral assets within group: supplementary

CHAPTER 5
OTHER KINDS OF QUALIFYING EXPENDITURE
414Expenditure on works likely to become valueless
415Contribution to buildings or works for benefit of employees abroad
416Expenditure on restoration within 3 years of ceasing to trade

CHAPTER 6
ALLOWANCES AND CHARGES
Writing-down and balancing allowances and balancing charges
417Determination of entitlement or liability
418Amount of allowances and charges

Unrelieved qualifying expenditure
419Unrelieved qualifying expenditure

Disposal values
420Meaning of "disposal receipt"
421Disposal of, or ceasing to use, asset
422Use of asset otherwise than for permitted development etc.
423Sections 421 and 422: amount of disposal value to be brought into account
424Disposal value restricted in case of interest in land
425Receipt of capital sum

Cases in which a person is entitled to a balancing allowance
426Pre-trading expenditure
427Giving up exploration, search or inquiry
428Ceasing to work mineral deposits
429Buildings etc. for benefit of employees abroad ceasing to be used
430Disposal of asset, etc.
431Discontinuance of trade

CHAPTER 7
SUPPLEMENTARY PROVISIONS
432Giving effect to allowances and charges
433Treatment of demolition costs
434Time when expenditure incurred
435Shares in assets
436Meaning of "development" etc.

PART 6
RESEARCH AND DEVELOPMENT ALLOWANCES
CHAPTER 1
INTRODUCTION
437Research and development allowances
438Expenditure on research and development

CHAPTER 2
QUALIFYING EXPENDITURE
439Qualifying expenditure
440Excluded expenditure: land

CHAPTER 3
ALLOWANCES AND CHARGES
441Allowances
442Balancing charges
443Disposal values and disposal events
444Disposal events: chargeable period for which disposal value is to be brought into account
445Costs of demolition

CHAPTER 4
ADDITIONAL VAT LIABILITIES AND REBATES
446Introduction
447Additional VAT liability treated as additional expenditure etc.
448Additional VAT rebate generates disposal value
449Effect on balancing charges of additional VAT rebates in earlier chargeable periods

CHAPTER 5
SUPPLEMENTARY PROVISIONS
450Giving effect to allowances and charges
451Sales: time of cessation of ownership

PART 7
KNOW-HOW ALLOWANCES
CHAPTER 1
INTRODUCTION
452Know-how allowances
453Know-how as property

CHAPTER 2
QUALIFYING EXPENDITURE
454Qualifying expenditure
455Excluded expenditure

CHAPTER 3
ALLOWANCES AND CHARGES
456Pooling of expenditure
457Determination of entitlement or liability
458Amount of allowances and charges
459Available qualifying expenditure
460Allocation of qualifying expenditure to pools
461Unrelieved qualifying expenditure
462Disposal values
463Giving effect to allowances and charges

PART 8
PATENT ALLOWANCES
CHAPTER 1
INTRODUCTION
464Patent allowances
465Future patent rights
466Grant of licences

CHAPTER 2
QUALIFYING EXPENDITURE
467Qualifying expenditure
468Qualifying trade expenditure
469Qualifying non-trade expenditure

CHAPTER 3
ALLOWANCES AND CHARGES
470Pooling of expenditure
471Determination of entitlement or liability
472Amount of allowances and charges
473Available qualifying expenditure
474Allocation of qualifying expenditure to pools
475Unrelieved qualifying expenditure
476Disposal value of patent rights
477Limit on amount of disposal value

CHAPTER 4
GIVING EFFECT TO ALLOWANCES AND CHARGES
478Persons having qualifying trade expenditure
479Persons having qualifying non-trade expenditure: income tax
480Persons having qualifying non-trade expenditure: corporation tax

CHAPTER 5
SUPPLEMENTARY PROVISIONS
481Anti-avoidance: limit on qualifying expenditure
482Sums paid for Crown use etc. treated as paid under licence
483Meaning of "income from patents"

PART 9
DREDGING ALLOWANCES
Qualifying expenditure on dredging, etc.
484Dredging allowances
485Qualifying expenditure
486Pre-trading expenditure of qualifying trades, etc.

Writing-down and balancing allowances
487Writing-down allowances
488Balancing allowances

Giving effect to allowances
489Giving effect to allowances

PART 10
ASSURED TENANCY ALLOWANCES
CHAPTER 1
INTRODUCTION
490Assured tenancy allowances
491Allowances available in relation to old expenditure only
492Meaning of "approved body"
493Expenditure on the construction of a building

CHAPTER 2
THE RELEVANT INTEREST
Introduction
494Introduction

The relevant interest in the building
495General rule as to what is the relevant interest in the building
496Interest acquired on completion of construction
497Effect of creation of subordinate interest
498Merger of leasehold interest
499Provisions applying on termination of lease

The relevant interest in the dwelling-house
500The relevant interest in the dwelling-house

CHAPTER 3
QUALIFYING EXPENDITURE
501Capital expenditure on construction
502Purchase of unused dwelling-house where developer not involved
503Purchase of dwelling-house sold unused by developer

CHAPTER 4
QUALIFYING DWELLING-HOUSES
504Requirements relating to the landlord
505Qualifying dwelling-houses: exclusions
506Dwelling-house ceasing to be qualifying dwelling-house

CHAPTER 5
WRITING-DOWN ALLOWANCES
Entitlement to and calculation of writing-down allowances
507Entitlement to writing-down allowance
508Basic rule for calculating amount of allowance
509Calculation of allowance after sale of relevant interest
510Allowance limited to residue of qualifying expenditure attributable to dwelling-house

Interpretation
511Qualifying expenditure attributable to dwelling-house
512Residue of qualifying expenditure attributable to dwelling-house

CHAPTER 6
BALANCING ADJUSTMENTS
General
513When balancing adjustments are made
514Balancing events
515Proceeds from balancing events

Calculation of balancing adjustments
516Dwelling-house a qualifying dwelling-house throughout
517Dwelling-house not a qualifying dwelling-house throughout
518Overall limit on balancing charge
519Recovery of old initial allowances made on incorrect assumptions

Meaning of "the relevant period of ownership" etc.
520The relevant period of ownership
521Starting expenditure
522Adjusted net cost

CHAPTER 7
WRITING OFF QUALIFYING EXPENDITURE ATTRIBUTABLE TO DWELLING-HOUSE
523Introduction
524Writing off initial allowances
525Writing off writing-down allowances
526Writing off expenditure for periods when building not used as qualifying dwelling-house
527Writing off or increase of expenditure where balancing adjustment made
528Treatment of demolition costs

CHAPTER 8
SUPPLEMENTARY PROVISIONS
529Giving effect to allowances and charges
530Apportionment of sums partly referable to non-qualifying assets
531Meaning of "dwelling-house", "lease" etc.

PART 11
CONTRIBUTIONS
CHAPTER 1
EXCLUSION OF EXPENDITURE MET BY CONTRIBUTIONS
Rules excluding contributions
532The general rule excluding contributions
533Exclusion of contributions to dredging

Exceptions to the general rule excluding contributions
534Northern Ireland regional development grants
535Insurance or compensation money
536Contributions not made by public bodies and not eligible for tax relief

CHAPTER 2
CONTRIBUTION ALLOWANCES
Contribution allowances under Parts 2 to 5
537Conditions for contribution allowances under Parts 2 to 5
538Plant and machinery
539Industrial buildings
540Agricultural buildings
541Mineral extraction

Effect of transfers of C's trade on contribution allowances under Parts 3, 4 and 5
542Transfer of C's trade or relevant activity

Contribution allowances under Part 9
543Contribution allowances under Part 9

PART 12
SUPPLEMENTARY PROVISIONS
CHAPTER 1
LIFE ASSURANCE BUSINESS
544Management assets
545Investment assets

CHAPTER 2
ADDITIONAL VAT LIABILITIES AND REBATES: INTERPRETATION, ETC.
546Introduction
547"Additional VAT liability" and "additional VAT rebate"
548Time when additional VAT liability or rebate is incurred or made
549Chargeable period in which, and time when, additional VAT liability or rebate accrues
550Apportionment of additional VAT liabilities and rebates
551Supplementary

CHAPTER 3
DISPOSALS OF OIL LICENCES: PROVISIONS RELATING TO PARTS 5 AND 6
Introduction
552Meaning of "oil licence" and "interest in an oil licence"

Oil licences relating to undeveloped areas
553Consideration to be treated as nil
554Circumstances in which oil licence relates to undeveloped area

Disposal of oil licence with exploitation value
555Disposal of oil licence with exploitation value

Minor definitions
556Minor definitions

CHAPTER 4
PARTNERSHIPS, SUCCESSIONS AND TRANSFERS
557Application of sections 558 and 559
558Effect of partnership changes
559Effect of successions
560Transfer of insurance company business
561Transfer of a UK trade to a company in another member State

CHAPTER 5
MISCELLANEOUS
Apportionment
562Apportionment where property sold together

Procedure for determining certain questions
563Procedure for determining certain questions affecting two or more persons
564Questions to which procedure in section 563 applies

Tax agreements for income tax purposes
565Tax agreements for income tax purposes

Companies not resident in the United Kingdom
566Companies not resident in the United Kingdom

Sales treated as being for alternative amount
567Sales treated as being for alternative amount: introductory
568Sales treated as being at market value
569Election to treat sale as being for alternative amount
570Elections: supplementary

CHAPTER 6
FINAL PROVISIONS
General interpretation
571Application of Act to parts of assets
572References to sale of property and time of sale
573Transfers treated as sales
574Meaning of "control"
575Connected persons
576Meaning of "the Inland Revenue" etc.
577Other definitions

Amendments, repeals, citation etc.
578Consequential amendments
579Commencement and transitional provisions and savings
580Repeals
581Citation
 

 
    Schedule 1-Abbreviations and defined expressions
    Part 1-Abbreviations
    Part 2-Defined expressions
    Schedule 2-Consequential amendments
    Schedule 3-Transitionals and savings
    Part 1-Continuity of the law
    Part 2-Changes in the law
    Part 3-General
    Part 4-Plant and machinery allowances
    Part 5-Industrial buildings allowances
    Part 6-Agricultural buildings allowances
    Part 7-Mineral extraction allowances
    Part 8-Research and development allowances
    Part 9-Patent allowances
    Part 10-Dredging allowances
    Part 11-Contributions
    Part 12-Supplemental
    Part 13-Other enactments
    Schedule 4-Repeals
 


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