CA26850 - PMA: Fixtures: Election procedure

CAA01/S200 - S201

An election under CAA01/S198 or S199 must be made by notice in writing to HMRC.

It should contain the following information:

  • the amount fixed by the election
  • the name of each person making the election
  • information sufficient to identify the plant or machinery fixture and the relevant land,
  • particulars of the interest acquired by or the lease granted to the purchaser
  • the Unique Tax Reference number (UTR) of each of the persons making the election, or confirmation that the person does not have a UTR.

The election is irrevocable.

The normal time limit for making the election is two years after the time when the interest is acquired by the buyer or the buyer is granted the lease. However, if one of the parties has made a valid application for a tribunal determination in order to meet the ‘fixed value requirement’ in CAA01/S187A (CA26478/CA26479), the time limit is extended and it is acceptable for the election to be made at any time before the tribunal determines the application or the application is withdrawn.   

A copy of the election must be included with each party's return for the first period affected by it. This will normally be the period in which the disposal or acquisition takes place. If the purchaser does not make a return, for example because it is not within the scope of UK tax, the purchaser is not required to include a copy of the election with a return. 

The amount apportioned to the fixture must be quantified when the election is made.

There may be cases where because of circumstances arising after the making of the election the maximum amount is reduced below the figure specified in the election. If this happens the election is deemed to have specified the reduced maximum amount.

Where an election is made by a partnership, the return that the election must accompany is the partnership return.

Asset and related value apportionments

The fixtures rules work on an asset-by-asset basis. In practice, you may accept a degree of amalgamation of assets where this will not distort the tax computation. However, following the introduction of the new classification of ‘integral features’ in respect of relevant expenditure incurred on or after 1 April 2008 (CT) or 6 April 2008 (IT) CA22300, it is necessary to distinguish between -

  • fixtures that are ‘integral features’ and so qualify for WDAs at the 8% rate in the special rate pool, and
  • fixtures that qualify for WDAs at the 18% rate in the main P&M pool

To do otherwise would clearly have the potential to distort the tax computation, which would be unacceptable. So, following the FA08 changes, it is now less likely that you will be able to accept an election covering all the fixtures in a particular property without requiring some apportionment of value between the two groups identified above. It has never been regarded as reasonable to accept an election covering all the fixtures for a portfolio of properties.