What is a Wasting Asset?
Wasting assets are properties and investments that have a limited life. Often, a wasted asset is a resource that is intended for use until there is nothing left. During the life of productive usage, assets of this type produce revenue, but eventually reach a state where the worth of the asset begins to wane. Natural resources that are acquired as investments are excellent examples of wasting assets. Timber is one type of wasting asset that can be harvested and refined for particular uses. In some instances, the timber is used in the construction of a home, where it reaches a pinnacle of worth then slowly begins to depreciate. With some applications of timber, the depletion comes more rapidly, such as in the production of wooden toothpicks. Discarded after one use, the timber that is converted and used for this purpose reaches the high point of value at the time of sale, then provides less and less return as the used products are crushed and recycled into other products. Eventually, the
A wasting asset that is owned by your pension scheme is an asset with a predictable life span of less than 50 years. Examples of wasting assets would include all machinery such as cars and vans. If you, or a member of your family or household, have personal use of a wasting asset, the scheme administrator will be liable to an additional tax charge known as the scheme sanction charge. This is in addition to any tax charge on the member as described in RPSM07200070.
