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AIA for a 31 March 2019 year end

Am I correct in saying that we can count based on the number of days, rather than months?

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Partnership with a year end of 31 March 2019.

Assets acuired pre 1 Jan 2019 = £25,000.

Assets acquired post 1 Jan 2019 = £425,000.

CCH is caluclating an AIA limit of £400,000 based on number of months.

As far as I'm aware, there is nothing stopping me using the number of days, and coming up with a figure of £408,219 (270/365 x £200,000 PLUS 95/365 x £1,000,000)

Is that correct?

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panda ketteringUK
By ketteringUK
23rd Oct 2019 17:37

'In the context of working out a business’s maximum AIA entitlement, therefore, HMRC will accept that it is just and reasonable to make the calculation on either a daily or monthly basis'

https://www.gov.uk/hmrc-internal-manuals/capital-allowances-manual/ca23085

Thanks (1)
By Tim Vane
23rd Oct 2019 18:26

Your reasoning is correct, only your maths is wrong. Luckily, CCH have got their maths correct, and identified that in this case months are in fact more advantageous. Start with 31+28+31.

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Replying to Tim Vane:
Lone Wolf
By Lone_Wolf
23rd Oct 2019 18:57

Damn! I calculated it to 5 April. Oh well, I'll change it back then.

Thanks.

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RLI
By lionofludesch
23rd Oct 2019 18:44

I'd stick with months.

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