Capital Allowances Flashcards
(13 cards)
How to treat integral features in sole trade and companies?
Sole trade - AIA, then special rates pool with 6% in following years
Company - AIA, then 50% FYA (special rates pool), remainder gets 6% in following years
After claiming 50% FYA you don’t calculated WDAs!
What qualifies as a long life asset and how are they treated?
Useful life 25+ years
Costs £100k+
In special rates pool.
AIA, then 50% FYAs!
WDA in following years (not same year).
What to do with SBAs and WDAs in shortened period?
Time apportion!! Remember!
What to do with capital allowances in extended period in sole trader and Ltd Co?
Sole trader - time apportion (1 working)
Ltd Co - two workings for each period (second period needs time apportioning)
What order to apply AIA?
Special rates pool, then main pool
If AIA used up, when would main pool assets qualify for 100% FYA?
Unused plant & machinery
What to use as disposal value?
How to apply this in main/special rates pool?
Lower of cost and proceeds
Remove amount from pool (no allowance on disposal unless pool is below £1,000)
What qualifies as 100% FYA?
- 0% emissions vehicles
- Electric charging point
- R&D equipment
- Equipment purchased in enterprise zones
- Unused plant & machinery (after AIA used)
How is land dealt with in capital allowances?
EXEMPT - capital gains item
Capital allowances in cash basis?
Only on cars
What qualifies for AIA in special rates pool?
- Long life assets
- Thermal insulation
- Integral features
What qualifies for SBAs?
Buildings with contracts to build after October 2018 (in Hardman’s)
Pretty much anything is included but land costs (roads etc)
In sole traders/partnerships, when would you not adjust for personal usage to WDAs?
When it is used by the employee
