Capital allowances ― groups and connected persons

Produced by Tolley in association with and

Owner-Managed Businesses

Guidance

Many provisions relating to capital allowances are disapplied or varied where the parties to a transaction are connected.

Definition of connected persons

Individuals

An individual is connected with a person if that person is:

•
the individual’s spouse / civil partner
•
a relative
•
the spouse / civil partner of a relative of the individual or of the individual’s spouse / civil partner

‘Relative’ means a brother, sister, ancestor or lineal descendant. ‘Lineal descendant’ will include any descendant of the spouse by a previous marriage though not a later marriage.

Settlements

A trustee of a settlement is connected with:

•
any individual who is a settlor in relation to that settlement
•
any person who is connected with that settlor
•
a body corporate which is deemed to be connected with that settlement

A body corporate is deemed to be connected with a settlement in any year of assessment if at any time in that year:

•
it is a close company (or only

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Martin Wilson

Martin Wilson, specialised in capital allowances for 25 years before retirement. He is the author of numerous published works on the subject, including Bloomsbury's Capital Allowances: Transactions & Planning, and the capital allowances content of LexisPSL, Tolley's Tax Guidance, Tolley's Tax Planning and Simon's Tax Planning.

Steven Bone

Director at Gateley Capitus

Steven is a tax-qualified Chartered Surveyor who has specialised in tax incentives, including capital allowances and land remediation relief for over 20 years. Previously he held senior specialist positions in 'Big 4' and national mid-tier accountancy firms. Capital allowances underpin income tax and corporation tax calculations by giving tax relief for money spent to buy, build or alter commercial property.Steven works with owner-occupiers, investors and their advisers to provide capital allowances opinions, transaction support and specialist valuations for all types of property. This includes resolving HM Revenue capital allowances enquiries and giving expert evidence to tribunals and courts.Steven has contributed to many articles and books, including: Bloomsbury Professional's Capital Allowances, Tolley's Tax Planning, RICS's official Guidance Note for surveyors on Capital Allowances and Land Remediation Relief, and Practical Law Company's Practice Note on Commercial Property Standard Enquiry 32 dealing with capital allowances.

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