Capital Allowances Flashcards
1
Q
What are capital allowances?
A
A tax version of depreciation
2
Q
What does capital allowance replace?
A
The disallowed depreciation charge in the adjustment of profits
3
Q
How does capital allowance give tax relief?
A
Expenditure incurred on the cost of plant and machinery on a commercial building’s cost
4
Q
What is plant?
A
Defined as assets that perform an active function in the business (e.g office furniture)
5
Q
What is machinery?
A
Motor vehicles and computers
