Refurbishment after purchase

Can capital allowances be claimed on fixtures which are subsequently replaced?

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My client purchased a cottage which is now being run as a furnished holiday let.  A capital allowance purchase claim has identified plant and machinery allowances relating to a bathroom and kitchen which, although fully functional at purchase, were refurbished prior to the holiday letting business starting.  Should the capital allowances purchase claim be reduced by the amounts attributed to replaced items?  I can not find any specific guidance on this point.  The fixtures were not actually used in the business but on the other hand the expenditure was in connection with the qualifying activity. 

Many thanks

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By lionofludesch
05th Oct 2023 17:32
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By Piltdown Man
06th Oct 2023 10:02

If the purchased fixtures belonged to the taxpayer at some point during the period in which the FHL activity commenced then I vote yes. HMRC has the power to abate the cost of assets acquired which are obsolescent in an apportionment, but as you say the items were fully functional, it would be difficult for them to successfully use that argument.

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