| Capital Allowances Act 2001 |
| 2001 Chapter 2 - continued |
| Further provisions - continued |
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| back to previous text |
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| | CHAPTER 16 |
| | PARTIAL DEPRECIATION SUBSIDIES |
| 209 | Meaning of "partial depreciation subsidy"
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| | In this Chapter "partial depreciation subsidy" means a sum which-
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| | (a) is payable directly or indirectly to a person who has incurred qualifying expenditure for the purposes of a qualifying activity, |
| | (b) is in respect of, or takes account of, part of the depreciation of the plant or machinery resulting from its use for the purposes of that activity, and |
| | (c) does not fall to be taken into account as income of that person or in calculating the profits of any qualifying activity carried on by him. |
| 210 | Reduction of first-year allowances
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| | (1) If-
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| | (a) a person has incurred qualifying expenditure for the purposes of a qualifying activity carried on by him, and |
| | (b) it appears that a partial depreciation subsidy is, or will be, payable to him in the period during which the plant or machinery will be used for the purposes of that qualifying activity, |
| | the amount of any first-year allowance in respect of that expenditure must be reduced to an amount which is just and reasonable having regard to the relevant circumstances.
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| | (2) In calculating for the purposes of section 58 the balance left after deducting a first-year allowance, a reduction under subsection (1) is to be disregarded.
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| 211 | Single asset pool etc.
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| | (1) Qualifying expenditure to which this subsection applies, if allocated to a pool, must be allocated to a single asset pool.
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| | (2) Subsection (1) applies to qualifying expenditure if a partial depreciation subsidy relating to the plant or machinery has been paid to the person who incurred the expenditure.
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| | (3) Subsection (4) applies if-
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| | (a) qualifying expenditure has been allocated to a pool, and |
| | (b) a partial depreciation subsidy relating to the plant or machinery is paid to that person. |
| | (4) For the chargeable period in which the partial depreciation subsidy is paid-
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| | (a) the person is required to bring a disposal value into account in the pool referred to in subsection (3), and |
| | (b) an amount equal to the disposal value is allocated (as expenditure on the plant or machinery) to a single asset pool. |
| | (5) If qualifying expenditure in respect of any plant or machinery is in a single asset pool under this section, there is no further allocation of that qualifying expenditure because a further partial depreciation subsidy is paid in respect of that plant or machinery.
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| 212 | Reduction of allowances and charges on expenditure in single asset pool
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| | (1) This section applies if expenditure is in a single asset pool under section 211(1) or (4).
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| | (2) The amount of-
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| | (a) any writing-down allowance or balancing allowance to which the person is entitled, or |
| | (b) any balancing charge to which the person is liable, |
| | must be reduced to an amount which is just and reasonable having regard to the relevant circumstances.
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| | (3) In calculating under section 59 the amount of unrelieved qualifying expenditure carried forward, a reduction of a writing-down allowance under subsection (2) is to be disregarded.
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| | (4) If a person entitled to a writing-down allowance for a chargeable period-
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| | (a) does not claim the allowance, or |
| | (b) claims less than the full amount of the allowance, |
| | the unrelieved qualifying expenditure carried forward from the period is to be treated as not reduced or (as the case may be) only proportionately reduced.
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