Capital Allowances Act 2001 section 182

Purchaser of land discharging obligations of equipment lessee

Section 182 deals with how a person who buys an interest in land can be treated as the owner of a fixture for capital allowances purposes, where they pay a capital sum to discharge the equipment lessee's obligations under an equipment lease relating to that fixture.

• Where plant or machinery has become a fixture and is subject to an equipment lease, a purchaser of an existing interest in the land who pays a capital sum to discharge the equipment lessee's lease obligations is treated as the owner of the fixture from the date of acquisition.
• The purchaser's qualifying expenditure on the fixture is the capital sum paid to discharge those lease obligations.
• This treatment does not apply — and is treated as never having applied — if another person holds a prior right in relation to the fixture immediately after the acquisition.
• The test for whether someone has a prior right is the same test set out in section 181(3), and this section does not cover situations where the equipment lessor is treated as the owner under section 177, which are instead addressed by sections 192 and 195.