Corporation Tax Act 2010 section 400

"PM" in section 399

Section 400 defines how to calculate the "PM" (plant or machinery) figure used in the formula in section 399 for determining the basic amount of income from a lessor's leasing business.

• Plant or machinery for these purposes includes all plant or machinery held by the company, whether leased out or not, but excludes items where no qualifying capital allowances expenditure has been incurred, items under long funding leases where the company is lessor, items treated as owned by another person under hire-purchase arrangements, and items disregarded under the migration rules in section 407.
• PM is calculated by adding together the balance sheet values of the company's plant or machinery at the start of the relevant day, plus the balance sheet values at the end of that day for any plant or machinery transferred in from an associated company.
• Plant or machinery counts as "relevant transferred plant or machinery" if it would have appeared on the balance sheet of an associated company at the start of the relevant day — in other words, it has been acquired from a connected group company during that day.
• The detailed mechanics of section 400 are supplemented by section 401 and modified by section 402, which deals with cases where the relevant company is itself a lessee under a long funding lease.