18 |
The disposal values depend on the circumstances of the grant.152 The meaning of ‘computer software’ is to be determined by the courts.153 |
24A.2.4 Plant or Setting |
24A.2.4.1 Statutory Prescription of Settings154 |
Since 1994, statute has governed the boundary between Plant and Machinery and settings; originally CAA Schedule AA1 now CAA 2001, sections 21–25. Section. 21 provides List A which are assets which must be treated as buildings and not as plant, while section 22 provides List B which are certain structures which must be treated in the same way. Section 23 gives us List C which is a long lists of exceptions to Lists A and B where traditional doctrine is still to apply. This elaboration does not affect a number of special provisions which treat specified expenditure as if it were plant or machinery—eg thermal insulation, fire safety, sports grounds and security.155 In view of the case law it is interesting to see that List C includes not only expenditure on the provision of a dry dock but also any glasshouse which is constructed so that the required environment (ie air, heat, light, irrigation and temperature) for growing plants is provided automatically by means of devices which are an integral part of its structure, is, for the purposes of this Act, expenditure on the provision of Plant or Machinery.156 |
The stated purpose of this change is that buildings and structures cannot qualify as plant (although it is also stated that the broad aim is that expenditure on buildings and structures which already qualify as plant should continue to do so).157 However, for the most part the list reflects what the courts have achieved. The effect of the change is partly to provide detailed guidance and partly to prevent judges from changing the law themselves. |
(a) Buildings. CAA 2001, section 21 begins with buildings, and excludes from the category of ‘plant or machinery’ any expenditure on the provision of a building. It defines ‘building’ as including any asset in the building which is incorporated into the building, or which, by reason of being moveable or otherwise, is not so incorporated, but is of a kind normally incorporated into buildings.158 This abstract statement is supplemented by Lists A and C. List A sets out assets which cannot be plant or machinery,159 include walls, floors, ceilings, doors, gates, shutters, windows and stairs, mains services, waste disposal, sewerage and drainage, shafts, etc for lifts and moving walkways and fire safety systems; examples of items in List C, which may be plant are electrical, cold water, gas and sewerage systems provided mainly to meet the particular requirements of the trade, or provided mainly to serve particular plant or machinery used for the purposes of the trade. Cold stores, caravans provided mainly for holiday lettings and any moveable building intended to be moved in the course of the trade are also in List C and so may also be plant. The legislation leaves it to the taxpayer to establish that these items are plant under existing law, case law. To make things clearer it is provided that an asset cannot come within List |