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Readers' forum: Tax and trains

09 September 2019
Issue: 4711 / Categories: Forum & Feedback
Tax treatment of the costs of installing a miniature railway.

My client operates a fun fair. As an added attraction he is thinking of installing a small ‘ride on’ railway which will be able to take parents and children around the site. I understand that this will operate on a 7¼ inch track which he will be purchasing second hand along with a couple of steam engines and ‘sit astride’ wagons.

I have been wondering about the tax treatment of these purchases. Presumably the engines and wagons will be eligible for capital allowances as plant and machinery but what about the track? Will this also be eligible for capital allowances even though it will be fixed to the land? The rails will be fixed to sleepers which will be positioned in stone ballast. I believe that the ballast will degrade over time and will need topping up; I assume that this will be a repair rather than a capital...

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