Part 1

Introduction
Chapter 1

Capital allowances: general

Capital expenditure
4
1
In this Act “capital expenditure” and “capital sums” are used in the sense given in this section.
2
“Capital expenditure” and “capital sums” do not include, in relation to a person incurring the expenditure or paying the sums—
a
any expenditure or sum that may be deducted in calculating the profits or gains of a trade, profession or vocation or property business carried on by the person, or
b
any expenditure or sum that may be deducted in calculating the emoluments of an employment or office held by the person.
3
“Capital expenditure” and “capital sums” do not include, in relation to a recipient of the expenditure or sums—
a
any amounts that are to be added in calculating the profits or gains of a trade, profession or vocation or property business carried on by the recipient, or
b
any amounts that are emoluments of an employment or office held by the recipient.
4
“Capital expenditure” and “capital sums” do not include, in relation to—
a
a person incurring the expenditure or paying the sums, or
b
a recipient of the expenditure or sums,
any expenditure or sum in the case of which a deduction of income tax falls or may fall to be made under section 348 or 349(1) of ICTA (annual payments).
5
Subsection (4) does not apply to any expenditure or sum in the case of which a deduction of income tax falls or may fall to be so made as a result of section 524(3)(b) of ICTA (receipts from sale of patent rights by person not resident in the UK).