Finance Act 1984

6 (1) Where in circumstances falling within paragraph 8 below a person carrying on a trade incurs capital expenditure on the provision of machinery or plant for the purposes of that trade under a contract—

(a) which is entered into after 13th March 1984 and on or before 31st March 1986, and

(b) which provides that he shall or may become the owner of the machinery or plant on or before the performance of the contract, and

(c) which either specifies no date on or by which the contractual obligations must be fully performed or specifies such a date which is after 31st March 1985,

Chapter I of Part III of the [1971 c. 68.] Finance Act 1971 shall have effect in relation to the capital expenditure so incurred subject to the following provisions of this paragraph.

(2) In this Part of this Schedule, in relation to a contract falling within sub-paragraph (1) above,—

• " the contract date " means the date on which the contract is entered into ;

• " the contract price " means the total capital expenditure on the provision of the machinery or plant which the person referred to in sub-paragraph (1) above is to incur pursuant to the contract;

• " the completion date " means the date specified as mentioned in sub-paragraph (1)(c) above or, if no date is so specified, 31st March 1987 ; and

• " the maximum allowable expenditure " shall be construed in accordance with paragraph 9 below.

(3) The provisions of this paragraph do not apply in relation to capital expenditure to which section 45(1)(b) of the Finance Act 1971 (machinery and plant on hire-purchase etc.) applies.

(4) In respect of capital expenditure incurred in either of the financial years 1984 and 1985 under a contract falling within sub-paragraph (1) above, the first-year allowance under section 42(1) of the Finance Act 1971 shall not exceed the fraction appropriate under paragraph 2 above of the maximum allowable expenditure for that year.

(5) So much (if any) of the capital expenditure incurred in the financial year 1984 under a contract falling within sub-paragraph (1) above as exceeds the maximum allowable expenditure for that year shall be deemed for all purposes of Chapter I of Part III of the Finance Act 1971 to be incurred on 1st April 1985.

(6) So much (if any) of the aggregate of—

(a) the capital expenditure incurred in the financial year 1985 under a contract falling within sub-paragraph (1) above, and

(b) any excess relating to that contract which, by virtue of sub-paragraph (5) above, is deemed to be incurred in that financial year,

as exceeds the maximum allowable expenditure for that financial year shall be deemed for all purposes of Chapter I of Part III of the [1971 c. 68.] Finance Act 1971 to be incurred on 1st April 1986.

(7) This paragraph shall be construed as if it were contained in Chapter I of Part III of the Finance Act 1971 except that expenditure shall not be treated for the purposes of this paragraph as having been incurred after the date on which it was in fact incurred by reason only of so much of section 50(4) of that Act as relates to expenditure incurred before a trade began.