On 31 May 2011 HMRC published a consultation document proposing
changes to the capital allowances regime in relation to fixtures.
Broadly the consultation proposes the following:
- a time limit on when expenditure on plant and machinery, including fixtures, needs to be pooled;
- the buyer and seller must agree the amount of the sale price attributable to the fixtures, which both the buyer and the seller should record and formally notify to HMRC;
- the minimum value a buyer and seller can adopt for section 198 election is the tax written down value ("TWDV") of the asset as opposed to £1; and
- improvements to section 197 Capital Allowances Act ("CAA 2001"), the anti-avoidance rule, to prevent the acceleration of capital allowances on fixtures by artificial arrangements.
These proposals will have a significant impact on the hotel and
leisure industry. The consultation ends on 31 August 2011 and we
are happy to assist you with any submissions you may wish to
make.
For greater detail on the proposed changes to capital allowances
for fixtures and its impact on the hotel and leisure industry,
please
click here.
This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq
Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.
The original publication date for this article was 28/07/2011.