Capital Allowances Act 2001 section 13A

Use for other purposes of plant or machinery previously used for long funding leasing

Section 13A deals with the capital allowances treatment when a person stops leasing plant or machinery under a long funding lease but continues to use it for the same qualifying activity.

• Applies when a person ceases to lease plant or machinery under a long funding lease but continues using it for the same qualifying activity, and still owns the asset at that date
• The person is treated as having incurred new capital expenditure ("notional expenditure") on the day after they stop leasing the asset
• The plant or machinery is treated as an entirely different asset from that point onwards, effectively resetting its capital allowances history
• The notional expenditure amount equals the termination amount determined under section 70YG for the last long funding lease under which the asset was leased