Capital Allowances Act 2001 section 165A

Decommissioning services supplied by connected person

Section 165A restricts plant and machinery allowances where a person carrying on (or who has ceased to carry on) a ring fence trade receives decommissioning services from a connected person, and all or part of the payment for those services is decommissioning expenditure.

• Allowances are restricted where a connected person provides decommissioning services to someone engaged in a ring fence trade, and all or part of the consideration is decommissioning expenditure
• The service can be provided directly or indirectly — it does not matter whether the parties share the same contract or whether payments are made directly between them
• Providing a service includes letting ships on charter, hiring out other assets, and supplying goods consumed in the course of delivering the service
• Decommissioning covers demolishing, preserving, preparing for reuse, or arranging the reuse of plant or machinery — regardless of whether reuse actually takes place