CA21160 | Plant and Machinery Allowances (PMA): meaning of plant and machinery: entity or piecemeal approach

For expenditure incurred on or after 1 April 2008 (CT) or on or after 6 April 2008 (IT) see the guidance on integral features starting at CA22300.

You sometimes have to decide whether something like an electrical system should be looked at as a whole (the entity approach) or whether you should look at the individual parts of the system separately (the piecemeal approach). Usually you should adopt the piecemeal approach. In the case of Attwood v Anduff car wash 69TC575, the taxpayer wanted to adopt an entity approach and claimed that the whole site was a single item of plant. The Special Commissioners accepted this but the High Court and the Court of Appeal found that the piecemeal approach should be adopted.

Prior to 1/6 April 2008, the piecemeal issue arose most often in connection with electrical systems and other integral features, which tend to function partly as ‘plant’ in common law, and partly as part of the setting, if considered on a piecemeal basis rather than a single entity basis. Under the rules now in CAA01/S33A, electrical systems and certain other integral features are always treated as if they were plant, regardless of function, therefore the piecemeal issue is no longer relevant to them, see CA22300.