The following Tax guidance note Produced in partnership with Martin Wilson provides comprehensive and up to date legal information covering:
Plant and machinery allowances are the most widely used form of capital allowance. Plant and machinery is often (wrongly) interpreted as if the terms ‘plant’ and ‘machinery’ were interchangeable, or as if they each meant nothing in isolation. This is not the case, and allowances are given for both ‘plant’ and ‘machinery’. This is important, as it is often easier to demonstrate that something is machinery, than that it is plant.
This Practice Note is about what is, and what is not, regarded as plant or machinery for the purposes of the capital allowances rules. It does not cover structures and buildings allowances (SBAs), which are a different type of capital allowance available for certain expenditure incurred on or after 29 October 2018 on non-residential structures and buildings. For information on SBAs, see Practice Note: Structures and buildings allowances.
Machinery is not defined for capital allowances purposes in statute or case law and so takes its ordinary meaning. HMRC accepts that the term machinery includes machines and the working parts of machines. At its most fundamental level, a machine or machinery is typically a device or assembly of interconnected fixed and movable parts which transmits force to do useful work and often (but not always) has a power supply. In terms of basic mechanics, a machine will generally consist of
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