Commentary

V7.238A Capital goods scheme—dealing with part disposals of a capital item

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.238A Capital goods scheme—dealing with part disposals of a capital item

Part V7 Tax planning | Commentary

V7.238A Capital goods scheme—dealing with part disposals of a capital item

Until 1 January 2011, the capital goods scheme period of adjustment was only brought to an end when the owner sold his complete interest in the item. So if, for example, part of a refurbishment was destroyed in a fire, or part of a building was sold, then a business would in theory continue to apply scheme adjustments on all of the VAT incurred on the asset, including that element sold or destroyed.

The new law since 1 January 2011 means that a business must carry out a final

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