The new capital allowances regime is now in full swing, but there are a few aspects of the regime which are likely to provoke problems in practice. Here is a guide to some of the more tricky points.
Five little days
The new regime applies to expenditure on or after the relevant day. In corporation tax this is 1 April 2008, in income tax, however, it is 6 April 2008. For sole traders and partnerships there is a risk that these five days will cause confusion (at best) and expensive mistakes at worst.
A sole trader with a financial period ending on 31 March 2008 will commence their new accounting period on 1 April 2008. This will form the basis period for the 2008-09 tax year. However, i...