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Victory for CPA over IR's capital allowances
17:24 29 May 2003
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The Construction Plant-hire Association (CPA) has claimed victory
in its campaign to persuade the Inland Revenue (IR) to allow plant
hirers to qualify for first year capital allowances (CJ 21 August
2002).
The IR has now agreed that where kit is bought "predominantly" for use with the company's own operator, the full 40% first year writing down allowance can be claimed. However, the IR's stance extends only to plant hired out with an operator.
"The ruling applies even if it is not immediately obvious that a piece of kit needs an operator as long as you can show that it does through the company's records," said CPA director Colin Wood.
The campaign was focussed on overturning the IR's assertion that purchasing plant and machinery for hiring out amounted to a leasing business because there was no service involved.
The IR has now agreed that where kit is bought "predominantly" for use with the company's own operator, the full 40% first year writing down allowance can be claimed. However, the IR's stance extends only to plant hired out with an operator.
"The ruling applies even if it is not immediately obvious that a piece of kit needs an operator as long as you can show that it does through the company's records," said CPA director Colin Wood.
The campaign was focussed on overturning the IR's assertion that purchasing plant and machinery for hiring out amounted to a leasing business because there was no service involved.
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