It is apparent from the Favourite Cinemas Ltd1 case, that a deduction cannot be claimed merely because the cost of an asset is paid in instalments. Expenditure of a recurring nature on the acquisition of assets which are fixed capital remains capital.
For HMRC guidance on recurrent payments, see BIM35305–BIM35315.
In Adam2, the taxpayer carried on the business of disposing of rubbish. To enable him to do so, he entered into an agreement enabling him to deposit earth, slag and ashes on certain vacant land. As consideration he agreed to pay £3,200 in 16 half-yearly instalments. Additional payments were to be made if the total deposit exceeded 80,000 cubic yards. The Crown contended that the payments were either capital sums or were
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