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Capital Allowances Act 2001

Chapter 6: Supplementary provisions
Overview

1341.This Chapter gives effect to allowances and charges under Part 4. It also contains supplementary provisions.

1342.Section 391 sets out how allowances are to be given effect for a person who is carrying on a trade. Section 392 does the same thing for a person who does not have a trade but has a Schedule A business. And it gives a further rule for anyone who has neither a trade nor a Schedule A business.

1343.Section 393 provides for extended meanings of “freehold interest in land” and “lease” for the purposes of this Part of the Act. This is particularly important for the definitions of “the related agricultural land” in section 361 and “the relevant interest in relation to any qualifying expenditure” in section 364.

Section 391: Trades

1344.This section is based on section 132(1) of CAA 1990. It gives effect to agricultural buildings allowances for a person carrying on a trade by:

  • treating the allowance as if it were an expense of the trade; and

  • treating the charge as if it were a receipt of the trade.

Section 392: Schedule A businesses

1345.This section is based on section 132(2) of CAA 1990. It gives effect to agricultural buildings allowances for persons who are not carrying on a trade.

1346.Subsection (2) gives effect to allowances and charges for persons carrying on a Schedule A business. The allowances and charges are treated as if they were expenses and receipts of the business.

1347.Subsection (3) gives effect to allowances and charges for all other persons. They are treated as if they had a Schedule A business.

Section 393: Meaning of “freehold interest”, “lease”, etc.

1348.With regard to the meaning of “lease” this section is based on interpretative provisions found in sections 161(2) and 162 of CAA 1990.

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