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This guidance note examines how to apply the CGS when assets are disposed of within the adjustment period, as well as some other common areas of difficulty.

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

For detail on how CGS adjustments are calculated, see the Capital goods scheme (CGS) ― intervals and adjustments guidance note.

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

In the Spring 2025 Tax Update, the government announced that it will simplify the Capital Goods Scheme by introducing the removal of computers from the assets covered by the scheme and increasing the capital expenditure value of land, buildings and civil engineering work to £600,000 (exclusive of VAT). This simplification will reduce the number of capital assets that would fall within the Capital Goods Scheme, therefore reducing the administrative burden on small businesses. The date of implementation of this change has not