Capital Allowances Act 2001 section 237

Exceptions to section 236

Section 237 sets out circumstances in which an additional VAT liability does not qualify for the Annual Investment Allowance or first-year allowances.

• An additional VAT liability cannot be AIA qualifying expenditure or first-year qualifying expenditure in certain circumstances
• The restriction applies where the plant or machinery is being used for overseas leasing at the time the VAT liability arises
• The exception does not apply if the overseas leasing counts as "protected leasing"
• Further anti-avoidance restrictions on first-year allowances for additional VAT liabilities are contained separately in section 241