Capital Allowances Act 2001 section 34A

Expenditure on plant or machinery for long funding leasing not qualifying expenditure

Section 34A prevents expenditure on plant or machinery intended for long funding leasing from being treated as qualifying expenditure for capital allowances purposes.

• Expenditure on plant or machinery provided for leasing under a long funding lease does not count as qualifying expenditure
• This means the lessor cannot claim capital allowances on such assets
• The restriction applies because, under long funding lease rules, the lessee rather than the lessor is generally treated as owning the asset for capital allowances purposes
• Further detail on the definition and treatment of long funding leases is found in Chapter 6A of the Capital Allowances Act 2001