Capital Allowances Act 2001 section 13

Use for qualifying activity of plant or machinery provided for other purposes

Section 13 deals with how capital allowances are calculated when plant or machinery originally bought for non-qualifying purposes is brought into use for a qualifying activity.

• When plant or machinery bought for other purposes is brought into a qualifying activity, the owner is treated as having incurred "notional expenditure" on it for that activity on the date it starts being used
• The notional expenditure is generally the market value of the asset on the date it enters the qualifying activity, but it is capped at the original cost (the "actual expenditure") if market value is higher
• If the actual expenditure cap applies, certain anti-avoidance deductions may further reduce the notional expenditure figure
• Whether the expenditure qualifies wholly or only partly for capital allowances depends on whether the asset is used wholly or only partly for the qualifying activity