Capital goods scheme (CGS) ― intervals and adjustments

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note examines when and how CGS adjustments are made and the duration of the CGS adjustment period.

For an overview of the CGS more broadly, see the Capital goods scheme (CGS) ― overview guidance note.

For details of how to apply the CGS when assets are disposed of, and other common areas of difficulty see the Capital goods scheme (CGS) ― dealing with the disposal of assets and other areas of difficulty guidance note

In-depth commentary on the CGS can be found in De Voil Indirect Tax Service V3.470.

When are CGS adjustments required?

In broad terms, the CGS requires that the use of certain ‘capital items’ is monitored over a period of time (otherwise known as an ‘adjustment period’). If, during this adjustment period, the use of the capital items changes then an adjustment must be made to the amount of input tax which was initially recovered on the capital item. This adjustment is designed to reflect the change in the way that the capital item is being

Access this article and thousands of others like it
free for 7 days with a trial of Tolley+™ Guidance.

TAKE A FREE TRIAL

Popular Articles

Owner-Managed Businesses

Residential property and capital allowances

Residential property and capital allowancesResidential property ― plant and machinery allowancesOrdinary residential property does not, and never has, qualified for capital allowances. as CAA 2001, s 35 denies plant allowances for expenditure incurred in providing plant or machinery for use in a

14 Jul 2020 17:14 | Produced by Tolley in association with Martin Wilson and Steven Bone Read more

Owner-Managed Businesses

Special rate pool and long life assets

Special rate pool and long life assetsSpecial rate poolExpenditure on some types of plant or machinery must, if neither annual investment allowance (AIA) nor first year allowances (FYAs) are available, be allocated to a ‘special rate pool’. Expenditure to be allocated to the special rate pool

14 Jul 2020 13:41 | Produced by Tolley Read more

Trusts and Inheritance Tax

Bare trusts ― income tax and CGT

Bare trusts ― income tax and CGTThis guidance note explains how trustees of bare trusts are treated for income tax and capital gains purposes. Although a bare trust is, in equity, a type of trust, for both income tax and capital gains tax purposes its existence is transparent. This means that no tax

14 Jul 2020 15:34 | Produced by Tolley Read more

UU��ֱ��