Capital Allowances Act 2001 section 51D

Third restriction: groups of companies under common control

Section 51D restricts the annual investment allowance (AIA) so that where two or more company groups are controlled by the same person and are related to one another, they must share a single AIA between all the member companies.

• Where two or more groups of companies are controlled by the same person and are related to one another in a financial year, only one AIA is available to be shared among all the companies in those groups.
• The companies may allocate that single AIA across their qualifying expenditure in whatever way they choose.
• The qualifying expenditure covered is that incurred by the companies in chargeable periods ending in the relevant financial year.
• A group of companies means a parent undertaking (as defined under the Companies Act 2006) together with the companies of which it is the parent at the end of their chargeable periods ending in the financial year in question.