Capital Allowances Act 2001 section 213

Relevant transactions: sale, hire-purchase (etc) and assignment

Section 213 defines what counts as a "relevant transaction" for the purposes of the anti-avoidance rules in this Chapter, covering sales, hire-purchase type contracts and assignments of contracts relating to plant or machinery.

• A relevant transaction arises when one party (S) sells plant or machinery to another (B), or B enters into a hire-purchase type contract with S, or S assigns to B the benefit of such a contract
• B's expenditure under the transaction is the capital expenditure on purchasing the asset, or capital expenditure under the contract relating to the plant or machinery (including, for assignments, any consideration paid for the assignment itself)
• Where B receives plant or machinery as a gift from S and brings it into business use, B is treated as having purchased it from S, ensuring the anti-avoidance rules still apply
• The disposal value under a relevant transaction is the amount that S must bring into account as a result of the sale, contract or assignment