Finance Act 1990

87 Capital allowances: vehicles provided by employees. U.K.

(1) In section 27 of the M1 Capital Allowances Act 1990 (professions, employments, vocations etc.) in subsection (1) for the words “and (3)”there shall be substituted the words “to (3)”.

(2) The following subsections shall be inserted after subsection (2) of that section—

(2A) In the case of machinery to which this subsection applies, subsection (2)(a) above shall have effect with the omission of the word “necessarily”.

(2B) Subsection (2A) above applies to machinery if—

(a) it consists of a mechanically propelled road vehicle, and

(b) capital expenditure incurred on its provision is incurred partly for the purposes of the office or employment and partly for other purposes.

(2C) Section 24 in its application in accordance with this section to an office or employment shall have effect, where a person’s qualifying expenditure consists of expenditure incurred on the provision of machinery to which subsection (2A) above applies, with the modifications set out in subsections (2D) and (2E) below.

(2D) In subsection (2)(b) for the word “whole” there shall be substituted the words “appropriate fraction”.

(2E) The following subsection shall be inserted after subsection (2)—

“(2A) For the purposes of subsection (2)(b) above the appropriate fraction is—

where—

• A is the number of chargeable periods in the case of which—

• (a) the person has carried on the trade,

• (b) the machinery or plant has belonged to him, and

• (c) he has claimed an allowance falling to be made to him under this section by reference to expenditure incurred on the provision of the machinery or plant; and

• B is the number of chargeable periods in the case of which—

• (a) the person has carried on the trade,

• (b) the machinery or plant has belonged to him, and

• (c) an allowance falls to be made to him under this section by reference to expenditure incurred on the provision of the machinery or plant.”

(3) Where—

(a) at the beginning of the year 1990-91 machinery consisting of a mechanically propelled road vehicle is provided by a person for use in the performance of the duties of an office or employment held by him, and

Part II of the M2 Capital Allowances Act 1990 shall have effect as if he had incurred capital expenditure on the provision of the machinery for the purposes of the office or employment in the year 1990-91, the amount of that expenditure being taken as the price which the machinery would have fetched if sold in the open market on 6th April 1990, and the machinery being treated as belonging to him in consequence of his having incurred that expenditure.

(4) This section shall apply for the year 1990-91 and subsequent years of assessment.

Marginal Citations

M1 1990 c. 1.

M2 1990 c. 1.