Capital allowance- disposal of assets

SophieChall

In the bpp question bank practice test two for the capital allowance question there’s a piece of plant and machinery that’s been sold for £5970 but the amount deducted in the computation is £4100 which was the original cost? Do you always need to deduct the original cost if there’s been a gain on the asset when it’s been disposed of?

MarieNoelle

Hi @SophieChall
Disposal proceeds for capital allowances purposes are limited to their original cost. So you use the lower of either proceeds or cost.