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Capital allowances question

Sarah-LouSarah-Lou Well-KnownRegistered Posts: 141
Although I'm practising as an MIP I am currently studying business tax as well.

During my experience with capital allowances I haven't come across this and between my book and my lecturer they are saying different things!

How do you deal with disposal of a single car in a special pool?

The study book says you continue writing down once the car is disposed of if there is a balance left. (Unlike the expensive car pool where you do a balancing allowance/charge).

Lecturer says that any single asset pool should have a balancing charge/allowance.

Tolleys tax seem to say the same.

How do you do it? Thank you!

Comments

  • jamesm96jamesm96 Experienced Mentor Registered Posts: 523
    Sarah-Lou wrote: »
    Although I'm practising as an MIP I am currently studying business tax as well.

    During my experience with capital allowances I haven't come across this and between my book and my lecturer they are saying different things!

    How do you deal with disposal of a single car in a special pool?

    The study book says you continue writing down once the car is disposed of if there is a balance left. (Unlike the expensive car pool where you do a balancing allowance/charge).

    Lecturer says that any single asset pool should have a balancing charge/allowance.

    Tolleys tax seem to say the same.

    How do you do it? Thank you!

    It's been a while since I studied the ins-and-outs of CAs and, if I'm being very honest, I tend to rely on the software these days (especially as none of my clients have very complicated capital expenditure anyway). However, is it not the case that if an asset is in a pool then you don't do the balancing allowance / charge, which is reserved for single asset 'pools'?
  • JmannJmann Feels At Home Registered Posts: 68
    Sarah-Lou wrote: »
    The study book says you continue writing down once the car is disposed of if there is a balance left. (Unlike the expensive car pool where you do a balancing allowance/charge).

    This is correct as per new capital allowance regime and apply to car purchased on or after 01/04/09 (06/04/09 for income tax). Cars with emissions of more than 160g/km are added to special rate pool where they attract 10% WDA.
    Sarah-Lou wrote: »
    Lecturer says that any single asset pool should have a balancing charge/allowance.

    Tolleys tax seem to say the same.

    This is correct too, if you have a expensive car purchased before 01/04/09 (06/04/09) then this car would be in single asset pool. where balance charge / allowance apply.

    Cars with private use in income tax business (sole trader / partnership) will remain subject to the single asset pool and will attract WDA based on their emissions.
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