Corporation Tax Act 2010 section 412

Provision supplementing section 411

Section 412 sets out the detailed rules for how balance sheet amounts are determined when calculating the relevant plant or machinery value under section 411, including how to handle fixtures in land, mixed finance leases, and connected party acquisitions.

• The relevant amounts are the net book value (or carrying amount) and the net investment in finance leases of the plant or machinery, as shown in the appropriate balance sheet of the partnership or company.
• Where plant or machinery is a fixture in land and its value is bundled into the land's net book value, the fixture's value must be separated out on a just and reasonable basis.
• Where a finance lease covers both plant or machinery and other assets (such as land), the net investment attributable to the plant or machinery must similarly be determined on a just and reasonable basis.
• Balance sheet figures are based on generally accepted accounting practice, with a special rule requiring connected party acquisitions to be recorded at an ascribed value where the relevant day is on or after 22 March 2006.