Capital Allowances Act 2001 section 182A

Purchaser of land discharging obligations of client under energy services agreement

Section 182A deals with the situation where a person purchases land containing fixtures that were originally provided under an energy services agreement, and the purchaser pays a capital sum to take over the client's obligations under that agreement.

• When a purchaser acquires an interest in land where plant or machinery has become a fixture under an energy services agreement, and pays a capital sum to discharge the client's obligations under that agreement, the purchaser is treated as the owner of the fixture
• The expenditure the purchaser is treated as having incurred on the provision of the fixture is the capital sum paid to discharge those obligations
• The interest in the land must have existed before the purchaser acquired it — this provision does not apply to newly created interests
• The ownership treatment does not apply if, immediately after the acquisition, another person holds a prior right in relation to the fixture, as determined by the test in section 181(3)