The following Owner-Managed Businesses guidance note by Tolley provides comprehensive and up to date tax information covering:
The general rule allowing capital allowances on plant and machinery is given at CAA 2001, s 11. There is no statutory definition of the term ‘plant and machinery’ but there is confirmation in the legislation on what constitutes a building or a structure and what is therefore not plant and machinery, and these details are set out below. Otherwise, the definition of plant and machinery has been developed through case law, which is also reviewed below.
The legislation does list some items which do qualify as plant and machinery with the main category of items being integral features, which are described further in the Special rate pool and long life assets guidance note. Other items specifically qualifying as plant and machinery are:
CAA 2001, ss 25–28, 33
Capital allowances are not available for plant and machinery used for business entertainment. Hospitality of any kind counts as business entertainment. However, plant and machinery provided by a business for its employees and directors is not considered to be provided for business entertainment and so capital allowances will therefore be available in this instance.
Buildings are part of the setting in which the business is carried on and do not qualify as plant and machinery. The term ‘building’ includes an asset which is incorporated into a building or would normally be incorporated into a building or is
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.