Capital Allowances Act 2001 section 212L

Balance sheet value

Section 212L defines how to calculate the balance sheet value (BSV) of relevant plant and machinery for the purposes of the capital allowances anti-avoidance provisions.

• BSV is the total of the net book values (carrying amounts) and net investments in finance leases shown for the relevant plant and machinery in the appropriate balance sheet of either party (C or P)
• Where plant or machinery is a fixture embedded in land, its net book value must be separated from the land value on a just and reasonable basis
• Where a finance lease covers both plant or machinery and non-qualifying assets such as land, the net investment attributable to the plant or machinery must similarly be apportioned on a just and reasonable basis
• The balance sheet must be prepared under generally accepted accounting practice as at the start of the relevant day, adjusted to reflect any disposals of the relevant plant or machinery occurring on that day