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HMRC internal manual

Capital Allowances Manual

PMA: Fixtures: Changes in ownership: Disposal value statements


In some cases it may be necessary to satisfy the disposal value statement requirement rather than the fixed value requirement. This is when the past owner is required to bring a disposal value into account in respect of the fixture in accordance with either of the following:

  • item 2 or 3 of the Table in section 196 (sale of qualifying interest at less than market value; cessation of ownership under section 188 where qualifying interest continues or would but for merging with another interest)
  • item 7 of the Table in section 61.

An example of the latter category is where a person’s qualifying activity is permanently discontinued but there is no immediate change of ownership of the fixture. In such circumstances the past owner is required to bring in a disposal value for the fixture in his or her final tax return without having sold the property. If the past owner then sold the property some years later he or she would be too late to enter into an election with the purchaser to fix the apportionment of the expenditure relating to fixtures.

In all these circumstances the current owner must obtain a written statement from the past owner of the disposal value he was required to bring into account. This statement must be made by the last owner within two years of the date he disposed of the property.