Capital Allowances Act 2001 section 187A

Effect of changes in ownership of a fixture

Section 187A sets out the conditions that must be met before a new owner of a fixture can claim capital allowances on expenditure relating to that fixture, where a previous owner was entitled to claim allowances on the same plant or machinery.

• When a fixture changes hands and the previous owner was entitled to claim capital allowances on it, the new owner's qualifying expenditure is treated as nil unless certain requirements are met
• The pooling requirement demands that the previous owner must have allocated the historic expenditure to a capital allowances pool, or claimed a first-year allowance, before or by the time they ceased to own the fixture
• The fixed value requirement applies where the previous owner had to account for a disposal value on a sale or lease, and requires either a formal apportionment (by joint election or tribunal determination within two years) or, failing that, written statements from the previous owner and the purchaser or lessee confirming the disposal value actually used
• The disposal value statement requirement applies in other disposal scenarios and requires the previous owner to have provided a written statement of the disposal value brought into account, within two years of ceasing to own the fixture, which the current owner must obtain