AIA and interaction with disposal
I have a client who is in his second year of trade.
As we did not claim all of his AIAs last year as they were not needed we have a balance in the brought forward pool of 10k.
One of the items purchased last year has had some enhancement expenditure on it this year (2k) and it was sold in this year for 15k.
Other items have been purchased totalling 50k. (We do not need to claim all as AIA, only circa £30k)
I was wondering 2 things, firstly does the enhancement expenditure qualify for AIA as asset sold in same year?
Secondly, is there a balancing charge in the pool (ie 10k less 15 disposal proceeds) giving a 5k charge and then I will claim the balance of what I need as AIA before transferring remainder into the pool to be carried forward.
Do I simply deduct the disposal proceeds from the Additions qualifying for AIA, give what I need as AIA and trans balance to pool.
The end result is the same, its just what is correct? Method 1 gives an AIA of 30 and a Bal Charge of £5k, whereas Method 2 will just give an AIA of 25
CA23086 seems to suggest Method 1 is correct - however the layout of the software suggests perhaps 2 is correct.
- Sage Payroll with 'employees' not having tax or NI deducted 43 1
- Why do HMRC have a different FPS liability to the amount I sent? 1,699 22
- Limited Company - Personal Bank Account 2,289 40
- How to account fot Cross-border vat. 79 1
- Paint Manufacturer Flat Rate Scheme 272 12
- Entrepreneurs' relief for trustees - receipt of rent 131 3
- VAT on motor expenses 878 31
- Associated companies - CT small profits relief 154 7
- Introduction of Goodwill 181 5
- PayPal Transaction Analysis 152 4
- Incorporation - any tax advantage? 736 19
- Company overdue but wants to be struck off 382 12
- Money transfers between companies owned by one person 195 9
- A change from the old Q v NQ debate 323 11
- Sage 50 (2010) 101 2
- ideas for a bonus scheme for accountants 387 3
- Recommendation of US tax adviser? 90 1
- Notes to statutory accounts 322 15
- Two clients (married to each other) disappeared from client list 400 9
- VAT code for invoice from not VAT registered company 133 2
- Skandia using wrong address 1,541
- Nil Rate Band Trust - index linked debt by way of charge over property 848
- International interest certificate 467
- NOVA 325
- Subby expenses subject to tax & NI? 225
- Can Limited Company Buy Share of Rental Property? 216
- Bonus Bonds 206
- Management expenses for investment company 202
- DOUBLE TAXATION RELIEF BETWEEN A PRIVATE LTD COMPANY AND GREECE (the private Ltd has no employees and its main activity is 194
- Have we escaped Gift with Reservation of Benfit & Pre-owned asset charges? - Gift after benefit 180