C1C5C4C3C6C7C8C9C10C11C12Part 2 Plant and machinery allowances
Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 paras. 10, 22 (with s. 38(2) ); S.I. 2004/2575 , art. 2(1) , Sch. 1
Pt. 2 modified (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 paras. 9(2), 21(2) (with s. 38(2)); S.I. 2004/2575, art. 2(1) , Sch. 1
Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 4 para. 4 ; S.I. 2004/2575 , art. 2(1) , Sch. 1
Pt. 2 modified (22.7.2008) by Crossrail Act 2008 (c. 18), Sch. 13 para. 19
Pt. 2 modified (22.7.2008) by Crossrail Act 2008 (c. 18), Sch. 13 para. 35
Pt. 2 modified (22.7.2008) by Crossrail Act 2008 (c. 18), Sch. 13 paras. 36, 37
Pt. 2 modified (21.7.2009) by Finance Act 2009 (c. 10), s. 24
Pt. 2 modified (17.7.2013) by Finance Act 2013 (c. 29), s. 73(7)-(11) (with s. 73(6))
Pt. 2 modified (10.6.2021) by Finance Act 2021 (c. 26), s. 9(1)(a)
Pt. 2 modified (11.7.2023) by Finance (No. 2) Act 2023 (c. 30), s. 7
Chapter 17F1Other anti-avoidance
Pt. 2 Ch. 17 heading substituted (8.4.2010) (with effect in accordance with Sch. 4 para. 5 to the amending Act) by Finance Act 2010 (c. 13), Sch. 4 para. 3
Restrictions on allowances
F2215Transactions to obtain tax advantages
1
Allowances under this Part are restrictedF4, and balancing charges are imposed or increased, under the applicable sections if F5B and S enter into a relevant transaction that either—
a
has an avoidance purpose, or
b
is part of, or occurs as a result of, a scheme or arrangement that has an avoidance purpose.
2
Subsection (1)(b) may be satisfied—
a
whether the scheme or arrangement was made before or after the relevant transaction was entered into, and
b
whether or not the scheme or arrangement is legally enforceable.
3
A transaction, scheme or arrangement has an “avoidance purpose” if the main purpose, or one of the main purposes, of a party in entering into the transaction, scheme or arrangement is to enable a person to obtain a tax advantage under this Part that would not otherwise be obtained.
4
The reference in subsection (3) to obtaining a tax advantage that would not otherwise be obtained includesF6—
a
obtaining an allowance that is in any way more favourable to a person than the one that would otherwise be obtainedF7, and
b
avoiding liability for the whole or part of a balancing charge to which a person would otherwise be liable.
F34A
If the tax advantage relates to the disposal value of the plant or machinery under the relevant transaction (whether by obtaining a more favourable allowance or by avoiding the whole or part of a balancing charge) then—
a
the applicable section is section 218ZB, and
b
the tax advantage is to be disregarded for the purposes of subsection (6) and (8)(b).
5
If the tax advantage is of a kind described in subsection (7), “the applicable sections” are sections 217 and 218ZA(5).
6
Otherwise, “the applicable sections” are sections 217 and 218ZA(1) or, as the case may be, 218ZA(3).
7
The kinds of tax advantage are—
a
that an allowance to which B is entitled for a chargeable period is calculated using a percentage rate that is higher than the one that would otherwise be used, or
b
that B is entitled to an allowance in respect of an amount of capital expenditure sooner than B would otherwise be entitled to it.
8
If a transaction, scheme or arrangement involves—
a
a tax advantage of a kind described in subsection (7), and
b
a tax advantage not of such a kind,
subsections (5) and (6) have effect separately in relation to each tax advantage.
Pt. 2 modified (24.2.2003) by Proceeds of Crime Act 2002 (c. 29), s. 458(1), Sch. 10 para. 12 (with Sch. 10 para. 17(1)); S.I. 2003/120, art. 2, Sch. (with arts. 34) (as amended (20.2.2003) by S.I. 2003/333, art. 14)