285B Acceleration of wear and tear allowances for childcare and fitness centre equipment

Summary

This section provides for an accelerated wear and tear allowance of 100% in respect of expenditure incurred by employers on or after 1 January 2019 on equipment used in a building which qualifies for capital allowances under section 843B (i.e. a building in use for the purposes of providing childcare services or fitness centre facilities to their employees).

Details

Definitions

(1) ““qualifying expenditure”” is defined as capital expenditure incurred on qualifying machinery or plant by a person carrying on a qualifying trade.

““qualifying machinery or plant”” is defined as machinery or plant in use in a qualifying premises.

““qualifying premises”” is as defined in section 843B and means a building or structure which is in use for the purposes of providing childcare services or fitness centre facilities to employees of the employer, which is not accessible nor available for use by the general public and, where that employer is a company, the employees of that company or of a company connected with that company.

Wear and tear allowances

(2) This subsection applies the provisions of Chapter 2 of Part 9 so that when a “wear and tear” allowance is made under section 284 to a person in respect of capital expenditure incurred on qualifying machinery or plant (as defined), the rate of allowance will be 100%. [Section 284 is the basic wear and tear allowances section for plant and machinery. Section 284(2)(ad) provides that, for capital expenditure incurred after 4 December 2002, the rate is 12.5%]. Subsection (2) of section 285B increases this rate to 100%.

Relevant Date: Finance Act 2021