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A matter of timing

24 May 2011 / Henry Wood
Issue: 4305 / Categories: Comment & Analysis , tax by numbers , Business , Income Tax
Always consider potential alternative methods of purchase and claims for relief for capital assets, advises HENRY WOOD


  • The importance of maximising capital allowances.
  • When is expenditure incurred for tax: CAA 2001 s 5.
  • Relief when the asset is brought into use under CAA 2001 s 67.
  • Comparing relief for finance lease costs.
  • Short-life elections under CAA 2001 s 85.

Frequent changes to capital allowances rules and rates have been used as a valve to be turned on and off so raising and lowering tax revenue as required.

Perhaps this is because capital allowances are an easy target; after all who notices a change in writing-down allowance from 25% to 20% and then four years later to 18%?

To illustrate this the Recent changes table shows how some of the main...

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