Where an interest in land that includes a fixture is sold, the
buyer normally has to apportion the sale price to determine the
part that relates to the fixture. The apportionment has to be
referred to the District Valuer
CA12300. There is legislation that lets
the parties to the sale fix the amount attributable to the fixture
provided that the seller has claimed capital allowances. This means
that fewer cases will need to be referred to the District Valuer.
If no election is made the existing rules about apportionments
apply. However, the election has no effect on the capital gains tax
position, and you may still need to seek valuations from the
District Valuer for capital gains tax purposes (see CG14771 -
CG14796 and CG74150 - CG74160).
Where a disposal value of a fixture is required to be brought to account by the former owner in a case where:
the buyer/ lessee and the former owner make a joint election.
The election fixes the amount treated as:
The amount apportioned to a fixture may not exceed:
The remainder, if any, of the sale price or premium is
attributed to the other property included in the sale. It should be
apportioned between the other property where necessary.
This agreed apportionment replaces any apportionment that would have been made under CAA01/S562 CA12300.
You cannot dispute the amount apportioned to a fixture under an election provided that it is within the limits above.
Guidance about the election procedure is in CA26850.
An election may not be made if CAA01/S197 (disposal values in avoidance cases) CA26750 applies.
If there is evidence that elections are being mis-used to avoid tax you should send a brief report of the facts and the suspected abuse to CT&VAT (Technical).