Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent discussions officials in his Department have had with representatives of HMRC on the classification of long-term and short-term vessels under the capital allowance scheme for commercial maritime vessels.
Treasury officials are in regular contact with HMRC colleagues. In line with the practice of successive administrations, details of internal discussions are not normally disclosed.
HMRC do not classify which assets should be written down at the main or special rate of writing down allowances. Instead, businesses should identify whether an asset they have acquired has a useful economic life (UEL) of more or less than 25 years when new. This UEL test for plant and machinery should be applied on the asset as a whole, rather than individual components; since for tax purposes the asset is depreciated as a single unit.