The Housing and Regeneration Transfer Schemes (Tax Consequences) Regulations 2015

Capital allowances: determination of disposal value of fixtures

8.—(1) This regulation applies if—

(a) there is a transfer of a fixture, and

(b) by virtue of the transfer a person is treated by section 188 of CAA 2001 (cessation of ownership when person ceases to have qualifying interest)(1) as ceasing to own the fixture.

(2) For the purposes of the application of section 196 of CAA 2001 (disposal values in relation to fixtures)(2) in relation to the transferor, the disposal value of the fixture is to be treated as such amount as is determined by the Secretary of State.

(3) An amount determined under paragraph (2) must not exceed the qualifying expenditure brought into account by the transferor for the purposes of CAA 2001 on its acquisition of the fixture.

(4) If an amount is determined under paragraph (2) then—

(a) the transferee is to be treated for the purposes of CAA 2001 as having incurred capital expenditure of that amount on acquiring an interest in the relevant land, and

(b) the expenditure which falls to be treated as incurred by the transferee is to be treated for the purposes of sections 181(1) and 182(1) of CAA 2001 (purchaser of land giving consideration for fixture or discharging obligations of equipment lessee) as being incurred by the giving of a consideration consisting in a capital sum of that amount.

(5) The expenditure treated as incurred under paragraph (4)(a) is to be treated as not being AIA qualifying expenditure for the purposes of CAA 2001.

(6) This regulation is subject to section 63(5) of CAA 2001 (cases in which disposal value is nil).

(1)

Section 188 was amended by paragraph 7 of Schedule 18 to the Finance Act 2001 (c. 9).

(2)

Section 196 was amended by paragraph 10 of Schedule 18 to the Finance Act 2001.