B3.332 Plant and machinery—pooling, writing-down allowances and balancing adjustments
Qualifying expenditure must be pooled to arrive at writing-down allowances and balancing allowances or charges1. Expenditure for separate qualifying activities must be allocated to separate pools2. There are single asset pools, class pools and the main pool3.
A single asset pool cannot contain expenditure in respect of more than one asset4. The provisions which determine if qualifying expenditure has to be allocated to a single asset pool relate to5:
• short-life assets (see B3.343)
• ships (see B3.344, B3.350–B3.351)
• plant or machinery provided or used partly for purposes other than those of a qualifying activity (see B3.359)
• payment of partial depreciation subsidy (see B3.360)
• contribution allowances (see B3.112)
Similar provision is made for class pools6. A class pool may contain expenditure relating to more than one asset. Only special rate expenditure (see below) is now allocated to a class pool (the 'special rate pool')7. Some taxpayers may still have another class pool, the 'overseas leasing pool' for expenditure incurred on plant or machinery for overseas leasing under leases finalised before 1 April 2006. See B3.340T.
Special rate expenditure must be allocated to the special rate pool if it is incurred wholly and exclusively for the purposes of a qualifying activity and is not required to be allocated to a single asset pool8.
'Special rate expenditure' is defined as9:
• expenditure on thermal insulation under CAA 2001, s 28 (see B3.310)
• expenditure on integral features under CAA 2001, s 33A (see B3.345)