Capital Allowances Act 2001 section 70B

Long funding operating lease: amount of capital expenditure

Section 70B determines how to calculate the amount of capital expenditure for capital allowance purposes when a lessee holds plant or machinery under a long funding operating lease.

• This section applies where a lessee is entitled to capital allowances under a long funding operating lease as provided by section 70A(6)
• The capital expenditure is equal to the market value of the plant or machinery at the relevant date
• The relevant date is the later of the lease commencement date or the date the asset is first used for the qualifying activity
• The section must be read together with section 70A, which sets out the overall entitlement to capital allowances for lessees under long funding leases