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HMRC internal manual

Business Income Manual

DVD and blu-ray disc traders: capital allowances

DVDs and blu-ray discs with a useful economic life of two years or more will qualify as plant. For more on the definition of plant for capital allowances purposes, see CA21010 onwards. The two year test is discussed in CA21100.

Where the two year test is met, capital allowances may be claimed both on the DVDs and blu-ray discs that form the original library and on any additions to that library. A short life asset election may be made, see CA23640.

Capital allowances may also be claimed on replacement DVDs and blu-ray discs that are sufficiently durable to qualify as plant.

For guidance on capital allowance claims, see CA11100 onwards.

Alternatives to capital allowances

The trader may decide to claim the statutory renewals allowance instead of capital allowances (see BIM67210).

If the item has a useful economic life of less than two years, and so does not qualify for capital allowances, the valuation basis can be used. For more details and a discussion of the meaning of useful economic life in the context of DVDs/blu-ray discs, see BIM67220.