Capital Allowances

Overview

These sheets are designed to calculate capital allowances, balancing allowances and balancing charges for tax purposes. The Capital allowance summary
sheet is created by inserting either a Business-trade or property
sheet or a Business-investment
sheet.

For each of the capital allowance pools or capital allowances types a sheet will be created for each business within the calculation and where there are multiple accounting periods additional columns will be added for each period. For the Capital allowance summary
and Annual investment allowance sheets, a new sheet will be created for each period.

Capital Allowance Summary

This sheet summarises the capital allowances, balancing allowances, and balancing charges within a business relating to the following capital allowances pools and capital allowances types:

Main pool

Special rate pool

Short life assets

Other allowances

Annual investment allowance

Parent and Know how allowances

Mineral extraction allowances

Structures and buildings allowances

R&D allowances

Ships allowances

Once this sheet has been developed no further manual entry will be required.

Completing the Sheets

Where you have identified amounts of capital expenditure that need to be allocated to one of the specific capital allowances pools or capital allowance type sheets above you should develop the sheet from the Insert sheet
menu for the appropriate business. Additions will be brought in automatically from the Additions analysis
sheet, the allowances calculated accordingly and then taken to the Capital allowance summary
sheet.

Any amounts brought forward can be entered manually when the computation is first created and they will be carried forward automatically, less any writing down allowances and other movements, for subsequent periods. Where applicable, you can also choose not to claim amounts of writing down allowance using the data entry cells provided.

Additional information for specific capital allowance sheets:

Short Life Assets

Where the appropriate elections were made, this sheet lets you reduce the number of years over which the asset is written down (SP 1/86 example 1), as well as deal with the case where a number of small items of the same type are pooled together (SP 1/86 example 2).

Mineral Extraction Allowances

For assets entered manually when the computation was first created, or for additions in the period, a writing down rate of either 10% or 25% can be selected for each asset that will be carried forward automatically.

Structures and Buildings Allowances

For each structure or building, the Date first brought into use
and Original expenditure
are required for the allowances to be calculated correctly.

R&D Allowances

Allowances of up to 100% are available, but any allowance disclaimed in the first period cannot be claimed in future periods. On each row, the Expenditure on which RDA claimed
and Original expenditure
are required. No allowance is calculated without these. This sheet is not applicable for investment businesses.

Annual Investment Allowance

Amounts in this sheet are populated automatically and reflect the eligible expenditure and annual investment allowance claimed. This is a review sheet only.

Ships allowances

For assets entered manually when the computation is first created or for additions in the period, a writing down rate of either 18% (Main pool), 6% (Special rate pool) or 10% (Overseas leased assets) can be selected for each asset which will be carried forward automatically. In addition, postponed allowances are tracked under the sheet Ships allowances postponed
.

Transfer of Trade

Where a transfer of trade takes place and there is a transfer of assets, separate sheets should be developed depending on whether the transfer is to or from the company. These sheets insert separate rows onto the capital allowance sheets and for further details refer to the specific Transfer of trade
help sheet.

This article applies to:

PRODUCT: ONESOURCE Corporate Tax

Solutions by Industry