Part 2

Plant and machinery allowances
Chapter 11

Overseas leasing

Qualifying purposes

Other qualifying purposes
125
1
Plant or machinery is used for a qualifying purpose at any time when subsection (2) or (4) applies.
2
This subsection applies if any of the persons listed in subsection (3) uses the plant or machinery for the purpose of a qualifying activity without leasing it.
3
The persons are—
a
the person (“X”) who incurred expenditure on the provision of the plant or machinery;
b
a person who is connected with X;
c
a person who acquired the plant or machinery from X as a result of a disposal on the occasion of which, or two or more disposals
on the occasion of each of which there was a change in the persons carrying on the qualifying activity in relation to which Condition A or B was met.
3A
Condition A is that—
a
at least one person who carried on the qualifying activity immediately before or immediately after the change was within the charge to income tax in respect of that activity, and
b
at least one person who carried on the qualifying activity before the change continued to carry it on after the change.
3B
Condition B is that—
a
the qualifying activity was carried on in partnership both immediately before and immediately after the change,
b
a company which was within the charge to corporation tax in respect of the activity carried it on immediately before or immediately after the change, and
c
at least one company which carried the activity on before the change continued to carry it on after the change.
4
This subsection applies if—
a
a lessee uses the plant or machinery for the purposes of a qualifying activity without leasing it, and
b
if he had incurred expenditure on the provision of the plant or machinery at that time, the expenditure would have fallen to be included, in whole or in part, in his available qualifying expenditure for a chargeable period.
5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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. 3 4) (as amended (20.2.2003) by S.I. 2003/333, art. 14)
S. 45H(2) modified (with effect in accordance with s. 167 of the amending Act) by Finance Act 2003 (c. 14) , Sch. 30 para. 7
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 (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. 9 paras. 10, 22 (with s. 38(2) ); S.I. 2004/2575 , art. 2(1) , Sch. 1
S. 125(5) repealed (with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 541(3), Sch. 3 (with Sch. 2)
S. 125(3)(c) substituted (with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 541(2) (with Sch. 2)
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
Words in s. 125(3)(c) substituted (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), s. 1329(1), Sch. 1 para. 489(2) (with Sch. 2 Pts. 1, 2)
S. 125(3A)(3B) inserted (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), s. 1329(1), Sch. 1 para. 489(3) (with Sch. 2 Pts. 1, 2)
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)