Capital Allowances Act 2001 section 218ZA

Restrictions on writing-down allowances: section 215

Section 218ZA restricts the amount of expenditure that can qualify for writing-down allowances where a transaction has been entered into to obtain a tax advantage under section 215.

• Where a transaction is caught by the anti-avoidance rule in section 215, some or all of the buyer's expenditure is excluded from qualifying expenditure for writing-down allowance purposes.
• The amount excluded is whichever is needed to cancel out the tax advantage obtained, capped at the total expenditure on the transaction.
• Where both this restriction and other restrictions (under sections 218 or 228) apply simultaneously, the greater of the two restriction amounts is used, ensuring the most effective restriction prevails.
• The restriction on writing-down allowances under this section applies regardless of whether other anti-avoidance restrictions also apply to the same transaction.