Expenditure on construction at nuclear site facility

The taxpayers were part of a corporate group that provided about 30% of the global enriched uranium supply for the civil nuclear industry. It built a tails management facility and claimed capital allowances on the capital expenditure. HMRC ruled that £192m did not qualify.

The First-tier Tribunal dismissed the taxpayers’ appeal saying that all the disputed expenditure was excluded by CAA 2001 s 21 and none was saved by being within list C of s 23. The Upper Tribunal found the decision contained errors of law. It therefore set it aside and remitted it to the First-tier Tribunal. HMRC appealed.

The Court of Appeal agreed with the First-tier Tribunal’s finding that the expenditure was on buildings or ‘items incorporated in or connected with buildings’ rather than plant. It was therefore not eligible for capital allowances under CAA 2001 s 21. HMRC’s appeal against the Upper Tribunal’s decision...