Changes in the world of capital allowances

A change is taking place next week in the world of capital allowances concerning the reduction of writing down allowances (WDA) on the special rate pool (SRP).

The rate for WDA in the SRP will be reduced from 8% to 6%.

This change will be effective from the following dates:

  • 1 April 2019 for businesses within charge to corporation tax
  • 5 April 2019 for businesses within charge to income tax

For those companies whose year-end straddles April, the WDA will be pro-rated ensuring that 8% is used before the change of the rate and 6% is used post the change.

This means that if a company has a year-end of 30 June 2019, 9 months of the SRP will receive WDA at 8% and the remaining 3 months will receive WDA at 6%.

Don’t forget that, to partially compensate for the reduction, Structures and Buildings Allowances came into play on 29 October 2018.

Contact our team for further details.

Contact us

Whether it’s a current investment project or you would like to discuss a historical review of expenditure, we can help.

Contact us