Capital allowances: generalE+W+S
10(1)This paragraph applies in relation to any relevant transfer—E+W+S
(a)from London Regional Transport to a subsidiary of London Regional Transport,
(b)from a subsidiary of London Regional Transport to London Regional Transport, or
(c)from a subsidiary of London Regional Transport to another such subsidiary,
which is certified to the Commissioners of Inland Revenue by London Regional Transport as made in preparation for, or in pursuance of, a PPP agreement.
(2)A PPP scheme which provides for a relevant transfer in relation to which this paragraph applies may include provision for amounts of expenditure by reference to which capital allowances may be made to the predecessor in relation to anything—
(a)to which the transfer relates, and
(b)which is specified, or of a description specified, for the purpose in the PPP scheme,
to be allocated to the transferee and treated for the purposes of the Corporation Tax Acts, as respects periods beginning on or after the transfer date, as expenditure by reference to which capital allowances may be made to the transferee instead of to the predecessor.
(3)Where an amount of expenditure is allocated under sub-paragraph (2) above to the transferee then, subject to sub-paragraph (4) below, there shall be made to or on the transferee in accordance with [F1the Capital Allowances Act 2001] all such allowances and charges as would have fallen to be made to or on him had he incurred expenditure of that amount on the transfer date in the acquisition, for the purposes of a trade carried on by him, of anything falling within paragraphs (a) and (b) of sub-paragraph (2) above.
(4)For the purposes of the Corporation Tax Acts, only such amounts (if any) as may be specified in or determined in accordance with the PPP scheme providing for a relevant transfer shall be allocated to the transferee in respect of expenditure by reference to which capital allowances may be made by virtue of sub-paragraph (3) above in relation to anything to which the transfer relates.
(5)The allocation in accordance with sub-paragraphs (2) and (4) above of an amount of expenditure to the transferee shall affect the amounts falling to be taken into account in relation to the predecessor as expenditure by reference to which capital allowances may be made only so far as necessary to give effect to a reduction of any such amount by a sum equal to so much of that amount as is so allocated to the transferee.
(6)If the PPP scheme in question so provides, then, notwithstanding sub-paragraph (5) above,—
(a)the predecessor shall be entitled, for its accounting period in which the transfer date falls, to allowances, determined in accordance with the PPP scheme, in respect of the amount so allocated, but
(b)for that purpose that amount shall be treated as reduced to the amount which bears to it the proportion which that part of the accounting period which falls before the transfer date bears to twelve months;
and a PPP scheme which makes any such provision may also make provision for or in connection with the making of an adjustment, determined in accordance with the PPP scheme, in relation to the transferee’s entitlement to allowances.
(7)Subject to sub-paragraph (8) below, the provisions of a PPP scheme providing for the determination of any amount which for the purposes of sub-paragraphs (2) and (4) above is to be allocated, in the case of any relevant transfer, to the transferee may include provision—
(a)for such a determination to be made by the Secretary of State in such manner as may be described in the scheme;
(b)for any amount determined to be calculated by reference to such factors, or to the opinion of such person, as may be so described;
(c)for or in connection with the making of any related determinations under sub-paragraph (6) above; or
(d)for a determination under those provisions, or under sub-paragraph (6) above, to be capable of being modified, on one or more occasions, in such manner and in such circumstances as may be so described.
(8)The consent of the Treasury shall be required for the making or modification of a determination of any such amount as is mentioned in sub-paragraph (7) above.
(9)Neither section 343 of the Taxes Act 1988 (company reconstructions without change of ownership) nor [F2section 266 of the Capital Allowances Act 2001 (election where predecessor and successor are connected persons)] shall have effect by virtue of a relevant transfer in relation to which this paragraph applies.
[F3(10)Except as provided by this paragraph, a relevant transfer in relation to which this paragraph applies shall be taken for the purposes of the Capital Allowances Act 2001 not to give rise to—
(a)any writing-down allowances, balancing allowances or balancing charges under Chapter 5 of Part 2 of that Act (plant and machinery allowances and charges),
(b)any disposal value being treated as received for the purposes of that Chapter,
(c)any qualifying expenditure being treated as incurred for the purposes of that Chapter, or
(d)any writing-down allowances, balancing allowances or balancing charges under Part 3 of that Act (industrial buildings allowances).]
Textual Amendments
F1Words in Sch. 33 para. 10(3) substituted (22.3.2001 with effect as mentioned in s. 579(1) of the amending Act) by 2001 c. 2, s. 578, Sch. 2 para. 105(4)
F2Words in Sch. 33 para. 10(9) substituted (22.3.2001 with effect as mentioned in s. 579(1) of the amending Act) by 2001 c. 2, s. 578, Sch. 2 para. 105(5)
F3Sch. 33 para. 10(10) substituted (22.3.2001 with effect as mentioned in s. 579(1) of the amending Act) by 2001 c. 2, s. 578, Sch. 2 para. 105(6)