Backdating capital allowances

04-Dec-2017 07:36

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There is disbelief when the software gives no balancing allowance but continues to give a writing down allowance for a car that has disappeared from the balance sheet. The taxpayer only gets a writing down allowance instead of a writing down allowance for the final chargeable period (s.55(4) CAA2001) and, unless the pool is a ‘single asset pool’, the final chargeable period is when the business ceases (s.).

Prior to the reform of allowances on cars in April 2009, an “expensive car” went into a single asset pool for that reason but since then cars are treated the same as any other plant as far as pooling rules go.

I think if there was a liability Revenue would have no problem in backdating the registration.

The most popular concern advisers have about cars is the absence of a balancing allowance when a company sells its only car.

She will not be able to claim the legal costs as pre-trade expenses for tax purposes because such expenses would not normally be deducted from trading profits as they are capital costs.

Back to the top You can read about this in the section 'what if I make a loss? Back to the top If you incur capital expenditure, on assets that will be used in your trade, before trading starts, the expenses are treated as being incurred on your first day of trading.

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You’ll need to report and pay Capital Gains Tax if your taxable gains are above your allowance.The tax treatment of these capital costs will depend if you are using the accruals basis or cash basis to prepare your accounts.If you are using the cash basis then you may be able to claim these as a business expense and if you are using the accruals basis you may be able to claim capital allowances.There is a first-year allowance available for cars with an emissions level-up to 75 g/km as long as the car is new and unused (or used only for the purpose of delivering it or using it as a demonstrator vehicle).

Given the limitation to a writing down allowance only, it is very often the case that when the time comes to get rid of the car, the unrelieved cost of the car is higher than it is worth.

and can claim capital allowances on the cost of the shelving (as long as he has not elected to use the cash basis).