In order to take advantage of using tolerances in AutoCAD Plant 3D 2016, you’ll need to modify your joint connections. The joint xml is located in the project folder and is called DefaultConnectorsConfig.xml.
My personal favorite xml editor is Foxe, and here is a link showing how to use it: http://www.pdoteam.com/2012/08/editing-xml-files/
You will want to set the OffsetTolerance value for each of your joints. The typical rule of thumb is that you design to one degree of precision larger than you will show dimensions for. So if you dimension to the 16th, you will want tolerances set to the 32nd. This helps avoid rounding issues since everything will be accurate to the 32nd.
Setting the offset tolerance for a buttweld joint would look like this:
Here is a link to download a connectors config with all of the default joints set to 1/32″ offset tolerance.Default Connectors Config - Imperial (927 downloads)
Setting the offset tolerance will allow ports to connect that are equal to or less than the tolerance apart.
In this example, I set my tolerance to 5 to show the exaggerated difference.