Capital Allowances Act 2001

Capital Allowances Act 2001

2001 Chapter 2

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Capital Allowances Act 2001

2001 Chapter 2

CONTENTS
PART 1
INTRODUCTION
CHAPTER 1
CAPITAL ALLOWANCES: GENERAL
Section
1	Capital allowances
2	General means of giving effect to capital allowances
3	Claims for capital allowances
4	Capital expenditure
5	When capital expenditure is incurred
6	Meaning of "chargeable period"
CHAPTER 2
EXCLUSION OF DOUBLE RELIEF
7	No double allowances
8	No double relief through pooling under Part 2 (plant and machinery allowances)
9	Interaction between fixtures claims and other claims
10	Interpretation
PART 2
PLANT AND MACHINERY ALLOWANCES
CHAPTER 1
INTRODUCTION
11	General conditions as to availability of plant and machinery allowances
12	Expenditure incurred before qualifying activity carried on
13	Use for qualifying activity of plant or machinery provided for other purposes
14	Use for qualifying activity of plant or machinery which is a gift
CHAPTER 2
QUALIFYING ACTIVITIES
15	Qualifying activities
16	Ordinary Schedule A businesses
17	Furnished holiday lettings businesses
18	Management of investment companies
19	Special leasing of plant or machinery
20	Employments and offices
CHAPTER 3
QUALIFYING EXPENDITURE
Buildings, structures and land
21	Buildings
22	Structures, assets and works
23	Expenditure unaffected by sections 21 and 22
24	Interests in land
25	Building alterations connected with installation of plant or machinery
Demolition costs
26	Demolition costs
Expenditure on thermal insulation, safety measures, etc.
27	Application of Part to thermal insulation, safety measures, etc.
28	Thermal insulation of industrial buildings
29	Fire safety
30	Safety at designated sports grounds
31	Safety at regulated stands at sports grounds
32	Safety at other sports grounds
33	Personal security
Exclusion of certain types of expenditure
34	Expenditure by MPs and others on accommodation
35	Expenditure on plant or machinery for use in dwelling-house not qualifying expenditure in certain cases
36	Restriction on qualifying expenditure in case of employment or office
37	Exclusion where sums payable in respect of depreciation
38	Production animals etc.
CHAPTER 4
FIRST-YEAR QUALIFYING EXPENDITURE
General
39	First-year allowances available for certain types of qualifying expenditure only
Types of expenditure which may qualify for first-year allowances
40	Expenditure incurred for Northern Ireland purposes by small or medium-sized enterprises
41	Miscellaneous exclusions from section 40 (expenditure for Northern Ireland purposes etc.)
42	Exclusion of plant or machinery partly for use outside Northern Ireland
43	Effect of plant or machinery subsequently being primarily for use outside Northern Ireland
44	Expenditure incurred by small or medium-sized enterprises
45	ICT expenditure incurred by small enterprises
46	General exclusions applying to sections 40, 44 and 45
Expenditure of small or medium-sized enterprises
47	Expenditure of small or medium-sized enterprises: companies
48	Expenditure of small or medium-sized enterprises: businesses
49	Whether company is a member of a large or medium-sized group
Supplementary
50	Time when expenditure is incurred
51	Disclosure of information between UK tax authorities
CHAPTER 5
ALLOWANCES AND CHARGES
First-year allowances
52	First-year allowances
Pooling
53	Pooling of qualifying expenditure
54	The different kinds of pools
Writing-down and balancing allowances and balancing charges
55	Determination of entitlement or liability
56	Amount of allowances and charges
Available qualifying expenditure
57	Available qualifying expenditure
58	Initial allocation of qualifying expenditure to pools
59	Unrelieved qualifying expenditure
Disposal events and disposal values: general
60	Meaning of "disposal receipt" and "disposal event"
61	Disposal events and disposal values
62	General limit on amount of disposal value
63	Cases in which disposal value is nil
64	Case in which no disposal value need be brought into account
The final chargeable period
65	The final chargeable period
List of provisions outside this Chapter about disposal values
66	List of provisions outside this Chapter about disposal values
CHAPTER 6
HIRE-PURCHASE ETC. AND PLANT OR MACHINERY PROVIDED BY LESSEE
Hire-purchase and similar contracts
67	Plant or machinery treated as owned by person entitled to benefit of contract, etc.
68	Disposal value on cessation of notional ownership
69	Hire-purchase etc. and fixtures
Plant or machinery provided by lessee
70	Plant or machinery provided by lessee
CHAPTER 7
COMPUTER SOFTWARE
71	Software and rights to software
72	Disposal values
73	Limit on disposal values
CHAPTER 8
CARS, ETC.
Cars above the cost threshold
74	Single asset pool
75	General limit on amount of writing-down allowance
76	Limit where part of expenditure met by another person
77	Car used partly for purposes other than those of qualifying activity
78	Effect of partial depreciation subsidy
79	Cases where Chapter 17 (anti-avoidance) applies
Vehicles provided for purposes of employment or office
80	Vehicles provided for purposes of employment or office
Interpretation
81	Extended meaning of "car"
82	Qualifying hire cars
CHAPTER 9
SHORT-LIFE ASSETS
83	Meaning of "short-life asset"
84	Cases in which short-life asset treatment is ruled out
85	Election for short-life asset treatment: procedure
86	Short-life asset pool
87	Short-life assets provided for leasing
88	Sales at under-value
89	Disposal to connected person
CHAPTER 10
LONG-LIFE ASSETS
Long-life asset expenditure
90	Long-life asset expenditure
91	Meaning of "long-life asset"
92	Application of Chapter to part of expenditure
Expenditure excluded from being long-life asset expenditure
93	Fixtures etc.
94	Ships
95	Railway assets
96	Cars
97	Expenditure within the relevant monetary limit: general
98	Expenditure to which the monetary limits apply
99	The monetary limit
100	Exceeding the monetary limit
Rules applying to long-life asset expenditure
101	Long-life asset pool
102	Writing-down allowances at 6%
Anti-avoidance provisions
103	Later claims
104	Disposal value of long-life assets
CHAPTER 11
OVERSEAS LEASING
Basic terms
105	"Leasing", "overseas leasing" etc.
106	The designated period
Certain expenditure to be pooled
107	The overseas leasing pool
108	Effect of disposal to connected person on overseas leasing pool
Allowances reduced or, in certain cases, prohibited
109	Writing-down allowances at 10%
110	Cases where allowances are prohibited
Recovery of excess allowances
111	Excess allowances: standard recovery mechanism
112	Excess allowances: connected persons
113	Excess allowances: special provision for ships
Recovery of allowances given in cases where prohibition applies
114	Prohibited allowances: standard recovery mechanism
115	Prohibited allowances: connected persons
Application of Chapter in relation to joint lessees
116	Mitigation of regime
117	Recovery of allowances in case of joint lessees
Duties to supply information
118	Certificate relating to protected leasing
119	Notice of change of use of plant or machinery
120	Notice and joint lessees
Qualifying purposes
121	Meaning of "short-term leasing"
122	Short-term leasing by buyer, lessee, etc.
123	Ships and aircraft
124	Transport containers
125	Other qualifying purposes
Minor definitions
126	Minor definitions
CHAPTER 12
SHIPS
Pooling and postponement of allowances
127	Single ship pool
128	Expenditure which is not to be allocated to single ship pool
129	Election to use the appropriate non-ship pool
130	Notice postponing first-year or writing-down allowance
131	Effect of postponement
132	Disposal events and single ship pool
133	Ship not used
Deferment of balancing charges
134	Deferment of balancing charges: introduction
135	Claim for deferment
136	Further conditions for deferment
137	Effect of deferment
138	Limit on amount deferred
139	Amount taken into account in respect of old ship
Attribution of deferred amounts
140	Notice attributing deferred amounts to new expenditure
141	Deferred amounts attributed to earlier expenditure first
142	Variation of attribution
143	Effect of attribution
144	Amounts which cease to be attributable
145	Requirement to notify where no entitlement to defer amounts
Expenditure on new shipping
146	Basic meaning of expenditure on new shipping
147	Exclusions: ship previously owned
148	Exclusions: object to secure deferment
149	Exclusions: later events
150	Exclusions where expenditure not incurred by shipowner
Qualifying ships
151	Basic meaning of qualifying ship
152	Ships under 100 tons
153	Ships which are not qualifying ships
154	Further registration requirement
Deferment of balancing charges: supplementary provisions
155	Change in the persons carrying on the qualifying activity
156	Connected persons
Further provisions
157	Adjustment of assessments etc.
158	Members of same group
CHAPTER 13
PROVISIONS AFFECTING MINING AND OIL INDUSTRIES
Expenditure connected with mineral extraction trades
159	Meaning of "mineral extraction trade" etc.
160	Expenditure treated as incurred for purposes of mineral extraction trade
161	Pre-trading expenditure on mineral exploration and access
Provisions relating to ring fence trades
162	Ring fence trade a separate qualifying activity
163	Meaning of "abandonment expenditure"
164	Abandonment expenditure incurred before cessation of ring fence trade
165	Abandonment expenditure within 3 years of ceasing ring fence trade
Transfers of interests in oil fields: anti-avoidance
166	Transfers of interests in oil fields: anti-avoidance
Oil production sharing contracts
167	Oil production sharing contracts
168	Expenditure on plant or machinery incurred by contractor
169	Expenditure on plant or machinery incurred by participator
170	Participator's expenditure attributable to plant or machinery
171	Disposal values on cessation of ownership
CHAPTER 14
FIXTURES
Introduction
172	Scope of Chapter etc.
173	Meaning of "fixture" and "relevant land"
174	Meaning of "equipment lease" and "lease"
175	Meaning of "interest in land", etc.
Persons who are treated as owners of fixtures
176	Person with interest in relevant land having fixture for purposes of qualifying activity
177	Equipment lessors
178	Equipment lessee has qualifying activity etc.
179	Equipment lessor has right to sever fixture that is not part of building
180	Equipment lease is part of affordable warmth programme
181	Purchaser of land giving consideration for fixture
182	Purchaser of land discharging obligations of equipment lessee
183	Incoming lessee where lessor entitled to allowances
184	Incoming lessee where lessor not entitled to allowances
Restrictions on amount of qualifying expenditure
185	Fixture on which a plant and machinery allowance has been claimed
186	Fixture on which an industrial buildings allowance has been made
187	Fixture on which a research and development allowance has been made
Cessation of ownership of fixtures
188	Cessation of ownership when person ceases to have qualifying interest
189	Identifying the qualifying interest in special cases
190	Cessation of ownership of lessor where section 183 applies
191	Cessation of ownership on severance of fixture
192	Cessation of ownership of equipment lessor
Acquisition of ownership of fixture when another ceases to own it
193	Acquisition of ownership by lessor or licensor on termination of lease or licence
194	Acquisition of ownership by assignee of equipment lessor
195	Acquisition of ownership by equipment lessee
Disposal values
196	Disposal values in relation to fixtures: general
197	Disposal values in avoidance cases
Election to fix apportionment
198	Election to apportion sale price on sale of qualifying interest
199	Election to apportion capital sum given by lessee on grant of lease
200	Elections under sections 198 and 199: supplementary
201	Elections under sections 198 and 199: procedure
Further provisions
202	Interpretation
203	Amendment of returns etc.
204	Appeals etc.
CHAPTER 15
ASSET PROVIDED OR USED ONLY PARTLY FOR QUALIFYING ACTIVITY
205	Reduction of first-year allowances
206	Single asset pool etc.
207	Reduction of allowances and charges on expenditure in single asset pool
208	Effect of significant reduction in use for purposes of qualifying activity
CHAPTER 16
PARTIAL DEPRECIATION SUBSIDIES
209	Meaning of "partial depreciation subsidy"
210	Reduction of first-year allowances
211	Single asset pool etc.
212	Reduction of allowances and charges on expenditure in single asset pool
CHAPTER 17
ANTI-AVOIDANCE
Relevant transactions
213	Relevant transactions: sale, hire-purchase (etc.) and assignment
Restrictions on allowances
214	Connected persons
215	Transactions to obtain allowances
216	Sale and leaseback, etc.
217	No first-year allowance for B's expenditure
218	Restriction on B's qualifying expenditure
Finance leases
219	Meaning of "finance lease"
220	Allocation of expenditure to a chargeable period
Sale and finance leasebacks
221	Meaning of "sale and finance leaseback"
222	Disposal value restricted
223	No first-year allowance for B's expenditure
224	Restriction on B's qualifying expenditure
225	B's qualifying expenditure if lessor not bearing non-compliance risk
226	Qualifying expenditure limited in subsequent transactions
Sale and leaseback or sale and finance leaseback: election for special treatment
227	Circumstances in which election may be made
228	Effect of election: relaxation of restriction on B's qualifying expenditure, etc.
Miscellaneous and supplementary
229	Hire-purchase etc.
230	Exception for manufacturers and suppliers
231	Adjustments of assessments etc.
232	Meaning of connected person
233	Additional VAT liabilities and rebates
CHAPTER 18
ADDITIONAL VAT LIABILITIES AND REBATES
Introduction
234	Introduction
Additional VAT liability
235	Additional VAT liability treated as qualifying expenditure
236	Additional VAT liability generates first-year allowance
237	Exceptions to section 236
Additional VAT rebate
238	Additional VAT rebate generates disposal value
239	Limit on disposal value where additional VAT rebate
Short-life assets: balancing allowance
240	Additional VAT liability
Anti-avoidance
241	No first-year allowance in respect of additional VAT liability
242	Restriction on B's qualifying expenditure: general
243	Restriction on B's qualifying expenditure: sale and finance leaseback
244	B's qualifying expenditure if lessor not bearing non-compliance risk
245	Effect of election under section 227 on additional VAT liability
246	Miscellaneous
CHAPTER 19
GIVING EFFECT TO ALLOWANCES AND CHARGES
Trades
247	Trades
Property businesses
248	Ordinary Schedule A businesses
249	Furnished holiday lettings businesses
250	Overseas property businesses
Activities analogous to trades
251	Professions and vocations
252	Mines, transport undertakings etc.
Investment companies
253	Investment companies
Life assurance business
254	Introductory
255	Apportionment of allowances and charges
256	Different giving effect rules for different categories of business
257	Supplementary
Special leasing of plant or machinery
258	Special leasing: income tax
259	Special leasing: corporation tax (general)
260	Special leasing: corporation tax (excess allowance)
261	Special leasing: life assurance business
Employments and offices
262	Employments and offices
CHAPTER 20
SUPPLEMENTARY PROVISIONS
Partnerships and successions
263	Qualifying activities carried on in partnership
264	Partnership using property of a partner
265	Successions: general
266	Election where predecessor and successor are connected persons
267	Effect of election
268	Successions by beneficiaries
Miscellaneous
269	Use of plant or machinery for business entertainment
270	Shares in plant or machinery
PART 3
INDUSTRIAL BUILDINGS ALLOWANCES
CHAPTER 1
INTRODUCTION
271	Industrial buildings allowances
272	Expenditure on the construction of a building
273	Preparation of sites for plant or machinery
CHAPTER 2
INDUSTRIAL BUILDINGS
Buildings in use for the purposes of a qualifying trade
274	Trades and undertakings which are "qualifying trades"
275	Building used for welfare of workers
276	Parts of trades and undertakings
277	Exclusion of dwelling-houses, retail shops, showrooms, hotels and offices etc.
278	Building used by more than one licensee
Qualifying hotels and sports pavilions
279	Qualifying hotels
280	Qualifying sports pavilions
Commercial buildings (enterprise zones)
281	Commercial buildings (enterprise zones)
Supplementary provisions
282	Buildings outside the United Kingdom
283	Non-industrial part of building disregarded
284	Roads on industrial estates etc.
285	Cessation of use and temporary disuse of building
CHAPTER 3
THE RELEVANT INTEREST IN THE BUILDING
286	General rule as to what is the relevant interest
287	Interest acquired on completion of construction
288	Effect of creation of subordinate interest
289	Merger of leasehold interest
290	Election to treat grant of lease exceeding 50 years as sale
291	Supplementary provisions with respect to elections
CHAPTER 4
QUALIFYING EXPENDITURE
Introduction
292	Meaning of "qualifying expenditure"
293	Meaning of references to carrying on a trade as a developer
Qualifying expenditure
294	Capital expenditure on construction of a building
295	Purchase of unused building where developer not involved
296	Purchase of building which has been sold unused by developer
297	Purchase of used building from developer
Qualifying enterprise zone expenditure
298	The time limit for qualifying enterprise zone expenditure
299	Application of section 294
300	Application of sections 295 and 296
301	Purchase of building within 2 years of first use
Part of expenditure within time limit for qualifying enterprise zone expenditure
302	Qualifying enterprise zone expenditure where section 295 or 296 applies
303	Purchase of building within 2 years of first use
304	Application of section 303 where developer involved
CHAPTER 5
INITIAL ALLOWANCES
305	Initial allowances for qualifying enterprise zone expenditure
306	Amount of initial allowance and period for which allowance made
307	Building not industrial building when first used etc.
308	Grants affecting entitlement to initial allowances
CHAPTER 6
WRITING-DOWN ALLOWANCES
309	Entitlement to writing-down allowance
310	Basic rule for calculating amount of allowance
311	Calculation of allowance after sale of relevant interest
312	Allowance limited to residue of qualifying expenditure
313	Meaning of "the residue of qualifying expenditure"
CHAPTER 7
BALANCING ADJUSTMENTS
General
314	When balancing adjustments are made
315	Main balancing events
316	Proceeds from main balancing events
317	Balancing event where hotel not qualifying hotel for 2 years
Calculation of balancing adjustments
318	Building an industrial building etc. throughout
319	Building not an industrial building etc. throughout
320	Overall limit on balancing charge
Meaning of "the relevant period of ownership" etc.
321	The relevant period of ownership
322	Starting expenditure
323	Adjusted net cost
324	Net allowances
Balancing allowances restricted where sale subject to subordinate interest
325	Balancing allowances restricted where sale subject to subordinate interest
326	Interpretation of section 325
Qualifying enterprise zone expenditure: effect of realising capital value
327	Capital value provisions: application of provisions
328	Balancing adjustment on realisation of capital value
329	Capital value that is attributable to subordinate interest
330	Exception for payments more than 7 years after agreement
331	Capital value provisions: interpretation
CHAPTER 8
WRITING OFF QUALIFYING EXPENDITURE
332	Introduction
333	Writing off initial allowances
334	Writing off writing-down allowances
335	Writing off research and development allowances
336	Writing off expenditure when building not an industrial building
337	Writing off or increase of expenditure where balancing adjustment made
338	Writing off capital value which has been realised
339	Crown or other person not within the charge to tax entitled to the relevant interest
340	Treatment of demolition costs
CHAPTER 9
HIGHWAY UNDERTAKINGS
341	Carrying on of highway undertakings
342	The relevant interest
343	Balancing adjustment on ending of concession
344	Cases where highway concession is to be treated as extended
CHAPTER 10
ADDITIONAL VAT LIABILITIES AND REBATES
Introduction
345	Introduction
Additional VAT liabilities
346	Additional VAT liabilities and initial allowances
347	Additional VAT liabilities and writing-down allowances
348	Additional VAT liabilities and writing off initial allowances
Additional VAT rebates
349	Additional VAT rebates and writing-down allowances
350	Additional VAT rebates and balancing adjustments
351	Additional VAT rebates and writing off qualifying expenditure
CHAPTER 11
GIVING EFFECT TO ALLOWANCES AND CHARGES
352	Trades
353	Lessors and licensors
354	Buildings temporarily out of use
355	Buildings for miners etc.: carry-back of balancing allowances
CHAPTER 12
SUPPLEMENTARY PROVISIONS
356	Apportionment of sums partly referable to non-qualifying assets
357	Arrangements having an artificial effect on pricing
358	Requisitioned land
359	Provisions applying on termination of lease
360	Meaning of "lease" etc.
PART 4
AGRICULTURAL BUILDINGS ALLOWANCES
CHAPTER 1
INTRODUCTION
361	Agricultural buildings allowances
362	Meaning of "husbandry"
363	Expenditure on the construction of a building
CHAPTER 2
THE RELEVANT INTEREST
364	General rule as to what is the relevant interest
365	Effect of creation of subordinate lease
366	Interest conveyed or assigned by way of security
367	Merger of leasehold interest
368	Provisions applying on ending of lease
CHAPTER 3
QUALIFYING EXPENDITURE
369	Capital expenditure on construction of agricultural building
370	Purchase of relevant interest before first use of agricultural building
371	Different relevant interests in different parts of the related agricultural land
CHAPTER 4
WRITING-DOWN ALLOWANCES
372	Entitlement to writing-down allowance
373	Basic rule for calculating amount of allowance
374	First use of building not for purposes of husbandry, etc.
375	Effect of acquisition of relevant interest after first use of building
376	Calculation of allowance after acquisition
377	Chargeable period when balancing adjustment made
378	Allowance limited to residue of qualifying expenditure
379	Final writing-down allowance
CHAPTER 5
BALANCING ADJUSTMENTS
General
380	When balancing adjustments are made
381	Balancing events (on making an election)
382	Requirements as to elections
383	Proceeds from balancing events
384	Exclusion of proportion of proceeds
Calculation of balancing adjustments
385	Calculation of balancing adjustment
386	The residue of qualifying expenditure
387	Overall limit on balancing charge
388	Acquisition of relevant interest in part of land, etc.
389	Balancing allowances restricted where sale subject to subordinate interest etc.
390	Interpretation of section 389
CHAPTER 6
SUPPLEMENTARY PROVISIONS
Giving effect to allowances and charges
391	Trades
392	Schedule A businesses
Meaning of "freehold interest", "lease" etc.
393	Meaning of "freehold interest", "lease", etc.
PART 5
MINERAL EXTRACTION ALLOWANCES
CHAPTER 1
INTRODUCTION
394	Mineral extraction allowances
395	Qualifying expenditure
396	Meaning of "mineral exploration and access"
397	Meaning of "mineral asset"
398	Relationship between main types of qualifying expenditure
399	Expenditure excluded from being qualifying expenditure
CHAPTER 2
QUALIFYING EXPENDITURE ON MINERAL EXPLORATION AND ACCESS
400	Qualifying expenditure on mineral exploration and access
401	Pre-trading exploration expenditure
402	Pre-trading expenditure on plant or machinery
CHAPTER 3
QUALIFYING EXPENDITURE ON ACQUIRING A MINERAL ASSET
403	Qualifying expenditure on acquiring a mineral asset
404	Exclusion of undeveloped market value of land
405	Qualifying expenditure where buildings or structures cease to be used
406	Reduction where premium relief previously allowed
CHAPTER 4
QUALIFYING EXPENDITURE: SECOND-HAND ASSETS
Assets reflecting expenditure on mineral exploration and access
407	Acquisition of mineral asset owned by previous trader
408	Acquisition of oil licence from non-trader
409	Acquisition of other assets from non-traders
Qualifying expenditure on assets limited by reference to historic costs
410	UK oil licence: limit is original licence payment
411	Assets generally: limit is residue of previous trader's qualifying expenditure
412	Transfers of mineral assets within group: limit is initial group expenditure
413	Transfers of mineral assets within group: supplementary
CHAPTER 5
OTHER KINDS OF QUALIFYING EXPENDITURE
414	Expenditure on works likely to become valueless
415	Contribution to buildings or works for benefit of employees abroad
416	Expenditure on restoration within 3 years of ceasing to trade
CHAPTER 6
ALLOWANCES AND CHARGES
Writing-down and balancing allowances and balancing charges
417	Determination of entitlement or liability
418	Amount of allowances and charges
Unrelieved qualifying expenditure
419	Unrelieved qualifying expenditure
Disposal values
420	Meaning of "disposal receipt"
421	Disposal of, or ceasing to use, asset
422	Use of asset otherwise than for permitted development etc.
423	Sections 421 and 422: amount of disposal value to be brought into account
424	Disposal value restricted in case of interest in land
425	Receipt of capital sum
Cases in which a person is entitled to a balancing allowance
426	Pre-trading expenditure
427	Giving up exploration, search or inquiry
428	Ceasing to work mineral deposits
429	Buildings etc. for benefit of employees abroad ceasing to be used
430	Disposal of asset, etc.
431	Discontinuance of trade
CHAPTER 7
SUPPLEMENTARY PROVISIONS
432	Giving effect to allowances and charges
433	Treatment of demolition costs
434	Time when expenditure incurred
435	Shares in assets
436	Meaning of "development" etc.
PART 6
RESEARCH AND DEVELOPMENT ALLOWANCES
CHAPTER 1
INTRODUCTION
437	Research and development allowances
438	Expenditure on research and development
CHAPTER 2
QUALIFYING EXPENDITURE
439	Qualifying expenditure
440	Excluded expenditure: land
CHAPTER 3
ALLOWANCES AND CHARGES
441	Allowances
442	Balancing charges
443	Disposal values and disposal events
444	Disposal events: chargeable period for which disposal value is to be brought into account
445	Costs of demolition
CHAPTER 4
ADDITIONAL VAT LIABILITIES AND REBATES
446	Introduction
447	Additional VAT liability treated as additional expenditure etc.
448	Additional VAT rebate generates disposal value
449	Effect on balancing charges of additional VAT rebates in earlier chargeable periods
CHAPTER 5
SUPPLEMENTARY PROVISIONS
450	Giving effect to allowances and charges
451	Sales: time of cessation of ownership
PART 7
KNOW-HOW ALLOWANCES
CHAPTER 1
INTRODUCTION
452	Know-how allowances
453	Know-how as property
CHAPTER 2
QUALIFYING EXPENDITURE
454	Qualifying expenditure
455	Excluded expenditure
CHAPTER 3
ALLOWANCES AND CHARGES
456	Pooling of expenditure
457	Determination of entitlement or liability
458	Amount of allowances and charges
459	Available qualifying expenditure
460	Allocation of qualifying expenditure to pools
461	Unrelieved qualifying expenditure
462	Disposal values
463	Giving effect to allowances and charges
PART 8
PATENT ALLOWANCES
CHAPTER 1
INTRODUCTION
464	Patent allowances
465	Future patent rights
466	Grant of licences
CHAPTER 2
QUALIFYING EXPENDITURE
467	Qualifying expenditure
468	Qualifying trade expenditure
469	Qualifying non-trade expenditure
CHAPTER 3
ALLOWANCES AND CHARGES
470	Pooling of expenditure
471	Determination of entitlement or liability
472	Amount of allowances and charges
473	Available qualifying expenditure
474	Allocation of qualifying expenditure to pools
475	Unrelieved qualifying expenditure
476	Disposal value of patent rights
477	Limit on amount of disposal value
CHAPTER 4
GIVING EFFECT TO ALLOWANCES AND CHARGES
478	Persons having qualifying trade expenditure
479	Persons having qualifying non-trade expenditure: income tax
480	Persons having qualifying non-trade expenditure: corporation tax
CHAPTER 5
SUPPLEMENTARY PROVISIONS
481	Anti-avoidance: limit on qualifying expenditure
482	Sums paid for Crown use etc. treated as paid under licence
483	Meaning of "income from patents"
PART 9
DREDGING ALLOWANCES
Qualifying expenditure on dredging, etc.
484	Dredging allowances
485	Qualifying expenditure
486	Pre-trading expenditure of qualifying trades, etc.
Writing-down and balancing allowances
487	Writing-down allowances
488	Balancing allowances
Giving effect to allowances
489	Giving effect to allowances
PART 10
ASSURED TENANCY ALLOWANCES
CHAPTER 1
INTRODUCTION
490	Assured tenancy allowances
491	Allowances available in relation to old expenditure only
492	Meaning of "approved body"
493	Expenditure on the construction of a building
CHAPTER 2
THE RELEVANT INTEREST
Introduction
494	Introduction
The relevant interest in the building
495	General rule as to what is the relevant interest in the building
496	Interest acquired on completion of construction
497	Effect of creation of subordinate interest
498	Merger of leasehold interest
499	Provisions applying on termination of lease
The relevant interest in the dwelling-house
500	The relevant interest in the dwelling-house
CHAPTER 3
QUALIFYING EXPENDITURE
501	Capital expenditure on construction
502	Purchase of unused dwelling-house where developer not involved
503	Purchase of dwelling-house sold unused by developer
CHAPTER 4
QUALIFYING DWELLING-HOUSES
504	Requirements relating to the landlord
505	Qualifying dwelling-houses: exclusions
506	Dwelling-house ceasing to be qualifying dwelling-house
CHAPTER 5
WRITING-DOWN ALLOWANCES
Entitlement to and calculation of writing-down allowances
507	Entitlement to writing-down allowance
508	Basic rule for calculating amount of allowance
509	Calculation of allowance after sale of relevant interest
510	Allowance limited to residue of qualifying expenditure attributable to dwelling-house
Interpretation
511	Qualifying expenditure attributable to dwelling-house
512	Residue of qualifying expenditure attributable to dwelling-house
CHAPTER 6
BALANCING ADJUSTMENTS
General
513	When balancing adjustments are made
514	Balancing events
515	Proceeds from balancing events
Calculation of balancing adjustments
516	Dwelling-house a qualifying dwelling-house throughout
517	Dwelling-house not a qualifying dwelling-house throughout
518	Overall limit on balancing charge
519	Recovery of old initial allowances made on incorrect assumptions
Meaning of "the relevant period of ownership" etc.
520	The relevant period of ownership
521	Starting expenditure
522	Adjusted net cost
CHAPTER 7
WRITING OFF QUALIFYING EXPENDITURE ATTRIBUTABLE TO DWELLING-HOUSE
523	Introduction
524	Writing off initial allowances
525	Writing off writing-down allowances
526	Writing off expenditure for periods when building not used as qualifying dwelling-house
527	Writing off or increase of expenditure where balancing adjustment made
528	Treatment of demolition costs
CHAPTER 8
SUPPLEMENTARY PROVISIONS
529	Giving effect to allowances and charges
530	Apportionment of sums partly referable to non-qualifying assets
531	Meaning of "dwelling-house", "lease" etc.
PART 11
CONTRIBUTIONS
CHAPTER 1
EXCLUSION OF EXPENDITURE MET BY CONTRIBUTIONS
Rules excluding contributions