Munby v Furlong 50 TC 491, 1977
Citation:Munby v Furlong 50 TC 491, 1977
Rule of thumb:Are organisations/traders allowed to invest in assets each years & deduct these costs as expenses from taxable profits? Yes, organisations/traders are allowed to incur a certain amount of expenses per year to update, maintain and add assets to their business and deduct this from tax, but above a certain level it is not deductible.
Judgment:
‘If you ask me for the ordinary meaning of the word "plant" I would not say that a horse and cart were plant, I would not call the partitions in a building separating a room "plant", but still the cases show that they are plant for tax purposes... ‘the courts do not apply the meaning to the word "plant" as the ordinary Englishman understands it. It has acquired by the course of decisions a special meaning in tax cases. It has acquired a special meaning; it seems to me, in the interests of fairness, that "plant" extends virtually to a man’s tools of trade ... It extends to the things which he uses day by day in the exercise of his profession.’ Lord Denning
Warning: This is not professional legal advice. This is not professional legal education advice. Please obtain professional guidance before embarking on any legal course of action. This is just an interpretation of a Judgment by persons of legal insight & varying levels of legal specialism, experience & expertise. Please read the Judgment yourself and form your own interpretation of it with professional assistance.