Finance Act 1996

The Capital Allowances Act 1990 (c. 1) U.K.

26 (1) Section 25 of the Capital Allowances Act 1990 (qualifying expenditure) shall be amended in accordance with the following provisions of this paragraph.

(2) In subsection (3) (election to be made by notice given to the inspector not later than two years after the end of the chargeable period related to the incurring of expenditure) for “the inspector not later than two years after the end of that chargeable period” there shall be substituted “ an officer of the Board within the period specified in subsection (3A) below ”.

(3) After subsection (3) there shall be inserted—

“(3A) The period mentioned in subsection (3) above is—

(a) for the purposes of income tax, the period ending with the first anniversary of the 31st January next following the year of assessment in which ends the chargeable period related to the incurring of the expenditure;

(b) for the purposes of corporation tax, the period of two years beginning at the end of the chargeable period related to the incurring of the expenditure.”

27 (1) Section 30 of the Capital Allowances Act 1990 (ships: first-year allowances) shall be amended in accordance with the following provisions of this paragraph.

(2) In subsection (1) (notices that may be given where first-year allowance falls to be made) for “the inspector not later than two years after the end of the period” there shall be substituted “ an officer of the Board within the period specified in subsection (1A) below ”.

(3) After subsection (1) there shall be inserted—

“(1A) The period mentioned in subsection (1) above is—

(a) for the purposes of income tax, the period ending with the first anniversary of the 31st January next following the year of assessment in which ends the period of account for which the allowance mentioned in that subsection falls to be made;

(b) for the purposes of corporation tax, the period of two years beginning at the end of the accounting period for which the allowance mentioned in that subsection falls to be made.”

28 For section 31(3) of the Capital Allowances Act 1990 (ships: notice to postpone writing-down allowance) there shall be substituted—

“(3) Where the shipowner has qualifying expenditure for a chargeable period in respect of his single ship trade, he may by notice given to an officer of the Board require the postponement of—

(a) the whole of the writing-down allowance to be made to him for that chargeable period, or

(b) so much of it as is specified in the notice.

(3A) A notice under subsection (3) above—

(a) for the purposes of income tax, shall be given on or before the first anniversary of the 31st January next following the year of assessment in which ends the chargeable period mentioned in that subsection;

(b) for the purposes of corporation tax, shall be given no later than two years after the end of the chargeable period mentioned in that subsection.”

29 (1) Section 33 of the Capital Allowances Act 1990 (ships: exclusion of section 31) shall be amended in accordance with the following provisions of this paragraph.

(2) For subsection (1) (notice to exclude section 31) there shall be substituted—

“(1) The shipowner may by notice given to an officer of the Board require that, with effect from the beginning of a chargeable period of a single ship trade, not being the chargeable period relating to the permanent discontinuance of that trade, section 31 shall not, or as the case may be, shall no longer apply.”

(3) For subsection (4) (notice to have expenditure in respect of single ship trade attributed to actual trade) there shall be substituted—

“(4) The shipowner may by notice given to an officer of the Board require that an amount of expenditure specified in the notice, being less than the amount which, apart from this subsection, would be his qualifying expenditure in respect of a single ship trade for a chargeable period of that trade, shall be attributed to his actual trade.”

(4) After subsection (5) there shall be substituted—

“(5A) A notice under subsection (1) or (4) above—

(a) for the purposes of income tax, shall be given on or before the first anniversary of the 31st January next following the year of assessment in which ends the chargeable period mentioned in that subsection;

(b) for the purposes of corporation tax, shall be given no later than two years after the end of the chargeable period mentioned in that subsection.”

30 (1) Section 37 of the Capital Allowances Act 1990 (election for certain machinery or plant to be treated as short life assets) shall be amended in accordance with the following provisions of this paragraph.

(2) In subsection (2) (elections)—

(a) in paragraph (c) (election may not be made more than two years after the end of the chargeable period in which the capital expenditure was incurred) for the words following “may not be made” there shall be substituted “ after the end of the period specified in subsection (2A) below ”; and

(b) the words following paragraph (d) shall cease to have effect.

(3) After that subsection there shall be inserted—

“(2A) The period mentioned in subsection (2) above is—

(a) for the purposes of income tax, the period ending with the first anniversary of the 31st January next following the year of assessment in which ends the chargeable period related to the incurring of the capital expenditure concerned;

(b) for the purposes of corporation tax, the period of two years beginning at the end of the chargeable period related to the incurring of the capital expenditure concerned;

and if different parts of the capital expenditure are incurred at different times, only that part of the expenditure which is first incurred shall be taken into account for the purposes of this subsection.”

31 (1) Section 53 of the Capital Allowances Act 1990 (expenditure incurred by equipment lessor) shall be amended in accordance with the following provisions of this paragraph.

(2) In subsection (2) (election to be made by notice given to the inspector before the expiry of the period of two years beginning at the end of the chargeable period related to the incurring of the expenditure)—

(a) for “the inspector” there shall be substituted “ an officer of the Board ”; and

(b) for “of two years beginning at the end of the chargeable period related to the incurring of the expenditure referred to in subsection (1)(a) above” there shall be substituted “ specified in subsection (2A) below ”.

(3) After that subsection there shall be inserted—

“(2A) The period mentioned in subsection (2) above is—

(a) for the purposes of income tax, the period ending with the first anniversary of the 31st January next following the year of assessment in which ends the chargeable period related to the incurring of the expenditure referred to in subsection (1)(a) above;

(b) for the purposes of corporation tax, the period of two years beginning at the end of the chargeable period related to the incurring of the expenditure referred to in subsection (1)(a) above.”

32 (1) Section 68 of the Capital Allowances Act 1990 (exclusion of certain expenditure relating to films, tapes and discs) shall be amended in accordance with the following provisions of this paragraph.

(2) In subsection (5) (claim to be made not later than two years after the end of the relevant period) for “not later than two years after the end of that period” there shall be substituted “ within the period specified in subsection (5A) below ”.

(3) After that subsection there shall be inserted—

“(5A) The period mentioned in subsection (5) above is—

(a) for the purposes of income tax, the period ending with the first anniversary of the 31st January next following the year of assessment in which ends the relevant period mentioned in that subsection;

(b) for the purposes of corporation tax, the period of two years beginning at the end of the relevant period mentioned in that subsection.”

(4) In subsection (9A)(b) (election to be made by giving notice to the inspector not later than two years after the end of the relevant period in which the film etc. is completed)—

(a) for “the inspector” there shall be substituted “ an officer of the Board ”; and

(b) for “not later than two years after the end of the relevant period in which the film, tape or disc is completed” there shall be substituted “ within the period specified in subsection (9AA) below ”.

(5) After subsection (9A) there shall be inserted—

“(9AA) The period mentioned in subsection (9A)(b) above is—

(a) in the case of an election for the purposes of income tax, the period ending with the first anniversary of the 31st January next following the year of assessment in which ends the relevant period in which the film, tape or disc is completed;

(b) in the case of an election for the purposes of corporation tax, the period of two years beginning at the end of the relevant period in which the film, tape or disc is completed.”

(6) In subsection (9B) for “(9A)(b)” there shall be substituted “ (9AA) ”.

33 In section 129(2) of the Capital Allowances Act 1990 (election to be made by notice given to the inspector not more than two years after the end of the chargeable period related to the occurrence of the event) for the words following “by notice given to” there shall be substituted “an officer of the Board; and—

(a) an election under this subsection for the purposes of income tax shall be made on or before the first anniversary of the 31st January next following the year of assessment in which ends the chargeable period related to the occurrence of the event; and

(b) an election under this subsection for the purposes of corporation tax shall be made not more than two years after the end of the chargeable period related to the occurrence of the event.”

[F1 34 In section 141(3) of the Capital Allowances Act 1990, in the second paragraph (election as respects an allowance for any year of assessment to be made by giving notice to the inspector not later than two years after the end of that year of assessment) for “the inspector not later than two years after the end of” there shall be substituted “ an officer of the Board on or before the first anniversary of the 31st January next following ”.]

Textual Amendments

F1 Sch. 21 para. 34 repealed (19.3.1997 with effect in accordance with Sch. 15 para. 9(1) of the amending Act) by 1997 c. 16, s. 85, Sch. 18 Pt. VI(11)