Chapter 7 - Capital Allowances

Question 1

What are non-qualifying assets for CAs on plant & machinery?

Answer 1

Buildings and their walls/fllors/ceilings/windows as these merely make up the setting in which business is carried out.

Question 2

What qualifies for 100% FYA?

Answer 2

NEW low emission cars
Zero emission goods vehicles (NEW)
R&D capital expenditure
Electrical charge point equipment
Purchase of P&M for use in a designated enterprize zone
FYA NEVER scaled up or down

Question 3

What is the Special Rate Pool (SRP) and what goes in it?

Answer 3

Long life assts - UL when new min 25 years, 100k spent on this kind of asset in a 12M acc period
Thermal insulation and solar panels
High emission cars
Integral features - electrical/cold water/heating/ventilation/air cooling systems, lifts, escelators

Question 4

What is the WDA for small pools?

Answer 4

If main pool or SRP balance is

Question 5

How are short life assets treated?

Answer 5

Kept in separate column in CAs computation.
For fast depreciating assets, e.g. computer equip.
Trader obtains a balancing adjustment on sale.
^Allowance or charge^
SLAs are a choice/election to use.

Question 6

How is pre-trading exp treated for CAs purposes?

Answer 6

Eligible for CAs, and treated as incurred on first day of trading.

Question 7

How are CAs dealt with upon cessation of trade?

Answer 7

All plant and machinery is disposed or deemed to be disposed of.
NO AIAs/FYAs/WDAs in final period of account - Balancing adjustments instead.
Any assets taken over by the owner are treated as sold for MV.