Capital Allowances Act 2001

182 Purchaser of land discharging obligations of equipment lessee

(1) If—

(a) after any plant or machinery has become a fixture, a person (“the purchaser”) acquires an interest in the relevant land,

(b) that interest was in existence before the purchaser’s acquisition of it,

(c) before that acquisition, the plant or machinery was let under an equipment lease, and

(d) in connection with that acquisition, the purchaser pays a capital sum to discharge the obligations of the equipment lessee under the equipment lease,

the purchaser is to be treated, on and after the time of the acquisition, as the owner of the fixture as a result of incurring expenditure, consisting of that capital sum, on the provision of the fixture.

(2) Subsection (1) does not apply, and is to be treated as never having applied, if—

(a) immediately after the time of the acquisition, any person holds another interest in any land in which the whole or any part of the relevant land is comprised, and

(b) the person holding that other interest has a prior right in relation to the fixture.

(3) Section 181(3) (test for whether the person holding the other interest has a prior right) applies for the purposes of subsection (2)(b).