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—(1) In section 44 of the Finance Act 1971 (writing-down allowances in respect of expenditure on machinery or plant) after subsection (2) there shall be inserted the following subsection:—
(2A) For any chargeable period ending after 13th March 1984 for which a company has qualifying expenditure, the company may, by notice in writing given to the inspector not later than two years after the end of that period, either disclaim a writing-down allowance or require that the allowance be reduced to an amount specified in that behalf in the notice";
and, in subsection (4) of that section, after "(2)" there shall be inserted "(2A)".
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(2) With respect to expenditure incurred after 13th March 1984, sub-paragraph (1) of paragraph 8 of Schedule 8 to the Finance Act 1971 (special rules for new ships) shall be amended by substituting for the words from "require the postponement" onwards the words—
(a) require the postponement of the whole allowance or, in the case of a company, disclaim it, or
(b) require that the amount of the allowance be reduced to an amount specified in the notice, or
(c) require the postponement of so much of the allowance as is so specified,
and a notice which contains a requirement under paragraph (b) above may also contain a requirement under paragraph (c) above with respect. to the reduced amount of the allowance".
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(3) In consequence of the amendment made by subsection (2) above, the said paragraph 8 shall also be amended, with respect to expenditure incurred after 13th March 1984, as follows:
(a) in sub-paragraph (2) for the words "in respect" there shall be substituted the words "requiring the postponement of the whole or part"; and
(b) at the end there shall be added the following sub-paragraph: —
(6) In any case where a notice under subparagraph (1) above contains requirements under both paragraphs (b) and (c) of that sub-paragraph, any reference in sub-paragraphs (2) to (5) above to the first-year allowance is a reference to the reduced amount of that allowance as specified in the notice.
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(4) In any case where—
(a) after 13th March 1984, a company carrying on a trade incurs capital expenditure on the provision of machinery or plant for the purposes of the trade, and
(b) apart from any disclaimer of the allowance, a first-year allowance would fall to be made for any chargeable period in respect of that expenditure, and
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(c) the company disclaims the allowance by notice under section 41(3) of the Finance Act 1971 or (in the case of new ships) under paragraph ((1)(a) of Schedule 8 to that Act,
then, for the purposes of section 44 of that Act, that expenditure shall not, by virtue of sub-paragraph (ii) of paragraph (a) of subsection (4) of that section, be excluded from the capital expenditure referred to in that paragraph.
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(5) In any case where—
(a) after 13th March 1984, a person carrying on a trade, but not being a company, incurs capital expenditure on the provision of machinery or plant for the purposes of the trade, and
(b) if a claim were made in that behalf, a first-year allowance would fall to be made in respect of that expenditure for the chargeable period related to the incurring of it, and
(c) no claim is so made but, by notice in writing given to the inspector not later than two years after the end of that chargeable period, the person concerned elects that this subsection shall apply,
then, for the purposes of section 44 of the Finance Act 1971, that expenditure shall not, by virtue of sub-paragraph (ii) of paragraph (a) of subsection (4) of that section, be excluded from the capital expenditure referred to in that paragraph.
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(6) In any case where
(a) after 13th March 1984, a person (whether a company or not) carrying on a trade has incurred capital expenditure on the provision of machinery or plant for the purposes of the trade, and
(b) a first-year allowance falls to be made to that person in respect of that expenditure (and, in the case of a person other than a company, a claim is made for that allowance), and
(c) for the chargeable period related to the incurring of that expenditure, the amount of that first-year allowance or, as the case may be, the aggregate amount of that and other first-year allowances which fall to be made to that person is required to be reduced by virtue of section 41(3) of the Finance Act 1971 or (in the case of new ships) paragraph 8(1)(b) of Schedule 8 to that Act,
then, for the purposes of section 44 of that Act, an amount equal to the relevant portion of so much of the expenditure giving rise to the first-year allowance or allowances referred to in paragraph (c) above as was incurred after 13th March 1984 shall be treated as expenditure in respect of which no first-year allowance is or could be made for the chargeable period in question.
§ (7) In subsection (6) above "the relevant portion" of expenditure giving rise to a first-year allowance or allowances and incurred after 13th March 1984 is that which hears to the whole of that expenditure the same proportion as the amount of the reduced allowance or allowances referred to in paragraph (c) of that subsection bears to what that amount would have been apart from the reduction.
§ (8) Subsections (2) to (7) above shall be construed as if they were contained in Chapter I of Part III of the Finance Act 1971.'. —[Mr. Moore.]
§ Brought up, and read the First time.
§ Mr. Deputy Speaker (Mr. Harold Walker)With this it will be convenient to discuss: