Capital allowances and wind farms

A recent case Gunfleet Sands Ltd (TC8387) involved wind farms a subject that can be important to farmers. The sums involved were significant as was the decision.

During the case questions were asked as to whether or not capital allowances claimed on expenditure for studies and project management prior to the construction of the wind farms qualified as the provision of plant. There were four appellant companies all of whom were members of the same group and each owned and operated an offshore wind farm to generate electricity for sale. This case together with the relentless scrutiny of capital allowance claims by HMRC shows the need to plan marginal and significant claims ahead of the expenditure to maximise the claim and to have awareness of where capital allowances will not be allowed. There is a clear need for accountants tax advisers...