An asset is a long-life asset for capital allowances and accounting purposes if its expected useful economic life is at least 25 years.
Estimates of life expectancy are taken from new, so if an asset is purchased second hand the previous owners use is taken into account.
From April 2012 solar panels will be treated as long-life assets
Capital allowances on long-life assets:
- New expenditure may qualify for a 100% annual investment allowance.
- When an asset is pooled it is subject to a lower rate of writing down allowance than other plant and machinery : 8% from 2012/13, 10% from 2011/12.
- Long-life assets may be fixtures and may be integral features.
- Integral Features have their own special rules for replacement.
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