Capital Allowances Act 2001 section 229

Hire-purchase etc

Section 229 provides special rules for calculating disposal values when plant or machinery acquired under hire-purchase or similar contracts is subject to the restrictions in this Chapter on allowances.

• Where a hire-purchase contract is assigned before the asset is used and allowances are restricted, the normal disposal value rules under section 68(3) are disapplied
• Where plant or machinery is acquired under a hire-purchase contract for leasing under a finance lease, the normal rules for timing of expenditure and disposal values under sections 67(3) and 68 are disapplied
• Instead, the disposal value is the total of any relevant capital sums received plus any capital expenditure the person would have incurred had they fully performed the contract
• Relevant capital sums include any consideration, compensation, damages or insurance money received in respect of the person's rights under the contract or the plant or machinery itself