Capital Allowances Act 2001 section 224

Restriction on B's qualifying expenditure

Section 224 restricts the buyer's qualifying expenditure in sale and finance leaseback transactions, thereby limiting the writing-down allowances available to that buyer.

• In a sale and finance leaseback, the buyer's qualifying expenditure is restricted, reducing the writing-down allowances they can claim.
• This provision operates in a similar manner to the restrictions applying under section 218 for other leaseback scenarios.
• The restriction applies specifically to finance leaseback cases where the seller sells an asset and then leases it back under a finance lease arrangement.
• If more than half the risk has been removed from the lessor, this section is disapplied and the stricter restrictions in section 225 apply instead.