Taxes Consolidation Act 1997 section 294

Machinery or plant used partly for non-trading purposes

Section 294 provides that where machinery or plant has been used partly for non-trading purposes, any balancing allowance or balancing charge must be adjusted to an amount that is just and reasonable.

• Where machinery or plant has been used for both trading and non-trading purposes, any balancing allowance or charge must reflect that mixed use.
• Wear and tear allowances on such assets are already restricted to reflect the extent of private or non-trading use.
• Without this section, the full unrestricted cost less the reduced allowances actually given would be treated as expenditure unallowed, potentially cancelling out the earlier restrictions on a subsequent sale.
• The section ensures that the balancing adjustment is calculated as an amount that is just and reasonable, having regard to all relevant circumstances and, in particular, the extent of non-trading use.