Tuesday 21 – Wednesday 22 June 2022
This is a second appeal. By appellant’s notice filed on 21 May 2021, the appellant taxpayer appeals the decision of Upper Tribunal Judges Mr Justice Adam Johnson and Judge Jonathan Richards dated 23 March 2021, whereby they dismissed their appeal against the decision of the First-tier Tribunal, holding that the applicant is not entitled to capital allowances in respect of certain satellites for its accounting period ending 31 December 1999.
The issue in this appeal relates to the application of section 78(1) of the Capital Allowances Act 1990, which makes provision for capital allowances in respect of plant or machinery where one person succeeds to another person’s trade and the plant or machinery continues to be used in the trade, but without being sold. The question is whether section 78(1) only applies, as held by the UT, where the plant or machinery actually belongs to the successor or whether it covers the situation where the plant or machinery does not belong to the successor.