• Service: Tax, Global Indirect Tax, Global Mobility Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 5/31/2013

United Kingdom - Capital allowances for plant/machinery expenditures 

May 31: The UK government announced that it introduced provisions, as part of the Finance Bill, to amend the capital allowances rules by providing that a business cannot claim capital allowances on capital expenditure on plant or machinery that is covered by a capital contribution from another business.

The draft legislation would apply to capital allowances claims made on or after 29 May 2013 by a recipient of a contribution and, in certain circumstances, to expenditures that are previously pooled. There would also be provisions to limit the value of any claims made.

This provision would be the first time that there would be a retroactive (retrospective) adjustment to items that have been claimed and pooled. For businesses that pooled such expenditure, there would be a requirement to bring into account a “disposal value” to remove the benefit of any unclaimed pool in respect of that expenditure.

For a business making a contribution, the legislation would only apply in relation to future contributions.

GAAR Advisory panel terms of reference

Guidance known as the terms of reference [PDF 33 KB] for the General Anti-Abuse Rule (GAAR) Advisory Panel, published by HM Revenue & Customs (HMRC), confirms that the panel will have two roles—to review HMRC’s guidance and to deliver opinions on individual cases referred to it by HMRC.

The terms of reference guidance confirms that a sub-panel of three panel members will consider each specific case referred and will aim to report their findings within 60 days of the referral.

Also discussed in the report are the following topics:

  • Life assurance – HMRC guidance
  • Management fee rebates
  • Offshore employment intermediaries consultation
  • Changes to advisory fuel rates
  • Taxation of partnerships consultation
  • Capital gains incorporation relief – property business
  • EU VAT Forum – Cross border VAT rulings requests

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