Capital Allowances Act 2001 section 41 (Schedule 3)

Disposal value in relation to fixtures: general

Section 41 of Schedule 3 provides a modified version of the disposal value rules for fixtures where a person ceased to own a fixture before 24th July 1996, including a further variation for expenditure incurred before 27th July 1989.

• This transitional rule applies where a person is treated as ceasing to own a fixture before 24th July 1996
• Where the former owner brings a disposal value into account and a new owner incurs expenditure on providing the fixture, any expenditure exceeding the disposal value is disregarded for capital allowances purposes
• This cap ensures the new owner cannot claim allowances on more than the disposal value the former owner brought into account
• For expenditure incurred before 27th July 1989, a slightly different version applies where the cap is based on the disposal value the former owner was required to bring into account, regardless of whether they actually did so