Having a moment... capital allowances

Can you have an empty pool with a value?

Didn't find your answer?

Hi all

I'm so used to claiming the AIA and having cars in separate pools due to private use, I think I've forgotten the basic rules when the situation is otherwise!

So a client buys a car with no private use, maybe it's a posh car to show off to customers and they leave it at the office and drive their Fiat Punto home afterwards.  It gets pooled in the main pool and WDA claimed each year.

They decide they want a new car, so they sell it for £5,000 when the WDV b/f is £10,000 but the new car has 10% private use, so that is put in its own section.  Is it correct that they now have new car (WDA less PU) and a pool with £5,000 in it, but no assets, attracting WDA as before?

As I say, apologies for the basic question, but it has been so long since I saw this situation I've lost the knowledge...

Replies (5)

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By Paul Crowley
23rd Jul 2020 09:26

It just runs on with WDA until pool small enough to write off small pool.

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Replying to Paul Crowley:
Quack
By Constantly Confused
23rd Jul 2020 09:31

Paul Crowley wrote:

It just runs on with WDA until pool small enough to write off small pool.

Thanks, I'd just come back to say I was happier now having seen a few things to support my thoughts.

It's how it's been treated, and it rang a bell as an 'odd' thing I learned when first studying, but as I say I haven't had it happen in practice in forever, so wanted to check!

Thanks for confirming.

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Lone Wolf
By Lone_Wolf
23rd Jul 2020 09:35

You're correct, you simply run with the "empty" pool until it goes below £1,000 and you can write it off. I think it's only on cessation of a trade that the main rate/special rate pools close otherwise.

It gave me a headache the first time I came across this. Didn't sit naturally there being a pool remaining when the business had no assets.

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Replying to Lone_Wolf:
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By Paul Crowley
23rd Jul 2020 09:45

Agree, cessatio of trade is the only way to get a balancing allowance unless sale exceeds bf
I have only had it once, on special pool, Landrover.
But then I do not really believe pool cars exist on proprietor owned companies. BUT just got one on a new client

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Replying to Paul Crowley:
Psycho
By Wilson Philips
23rd Jul 2020 12:29

Paul Crowley wrote:
Agree, cessatio of trade is the only way to get a balancing allowance unless sale exceeds bf

In which case it's unlikely to be a balancing allowance ;¬)

Pedants Anonymous

EDIT - I re-read your comment, with a different interpretation.

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