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Allowances - Plant |
See Also
Disposals | Fixed assets | Short life asset pools
External Links
HMRC Manuals - Plant and Machinery Allowance (PMA): Contents| HMRC Manuals - Plant & Machinery Allowance (PMA): Car : Contents
Select from the following headings:
Background | Developing the schedule | Completing the Schedule | Standard Sub-Schedules | Carry Forward | Related Errors
This schedule calculates capital allowances on general plant, based on additions and disposals. The additions should be categorised as qualifying for First Year Allowances (FYAs) or Writing Down Allowances (WDAs), where relevant. The expenditure qualifying for first year allowances should be analysed between its constituent parts at the foot of the schedule. The FYA rates can be amended if necessary.
2009 and later years
Cars acquired after 31 March 2009 that fall into the relevant CO2 emissions category should be added as either standard additions eligible for WDA or, where available, eligible for FYA.
One copy of this schedule may be developed by using the Develop option from each of the Fixed assets, Finance lease debtor, Expenses of management or UK Property income schedules.
The schedule follows normal tax sign conventions, not Debit / (Credit).
Some of the schedule entry cells are described in more detail below:
Tax written down value, beginning of period
The user is required to enter tax written down values brought forward for plant where these have not been automatically entered.
Capital assets expensed
There is a standard Capital assets expensed schedule to which items should be linked where their tax and accounting treatment differs (capital vs revenue). The software will transfer the totals of plant qualifying for FYAs and WDAs from the Capital assets expensed schedule to the plant schedule and will complete the relevant rows automatically.
Costs written off either qualifying for FYAs or WDAs may also be entered on this schedule. These costs are not automatically disallowed - the user should disallow them on the relevant expense analysis and then link the relevant figure to the capital allowances schedule by formula (for one item) or via a non-standard summarising schedule (for more than one item).
Waiving of WDAs
Written down allowances may be disclaimed by entering the figure for disclaimer in the appropriate cell towards the foot of the schedule.
CAA 2001 s220
Any expenditure restricted under CAA 2001 s220, which is available for carry forward and inclusion within the next accounting period under s220(1)(b) will be shown as a memorandum entry towards the foot of the schedule.
CAA 2001 s58(6) adjustments
Normally the balance of expenditure qualifying for FYAs after deducting the FYAs and any amounts on which FYAs are not claimed is transferred into the pool after the end of the accounting period in which the expenditure was incurred. This is not the case where an asset is disposed of in the same period in which FYAs are claimed on it, and in this case an adjustment is required under s58(6), CAA 2001.
Expenditure qualifying for FYAs
First year allowances may be claimable on certain expenditure incurred by companies. The qualifying expenditure on which first year allowances are claimed should be analysed between its constituent parts and similarly, the FYA rates held at the foot of the schedule amended should these not apply.
Cessation of Trade
Under the provisions of CAA 2001 s56 (7), a balancing adjustment arises on the plant pool on cessation of a qualifying activity.
If a company has ceased to perform a qualifying activity, and items still remain in the capital allowances pool, then the selector at the bottom of the B Schedule entitled ?Cessation?? should be changed to YES (the default position is NO). Changing the selector to YES will stop writing down allowances being calculated and calculate a balancing adjustment which is then taken through to the A schedule.
Changing the selector to YES will also prompt a disclosure sentence which will automatically be displayed on the face of the B schedule.
'Hybrid' rates of WDA
Where the rate of WDA changes between financial years and a 'hybrid rate' is required to be applied, the software calculates the relevant rate and displays this. Note that this will not display or print in the final version.
A data entry cell is provided to allow for the rate to be overriden if required, and for clarity the rate of WDA applied is also displayed.
Investment companies
The investment company variant of the schedule is identical to the trading company version, except that allowances are treated as expenses of management.
Write off of 'small pools'
Where the relevant provisions under CAA 2001, s56A apply, enter the amount of allowances claimed in the data entry cell provided. This removes the WDA calculation analysis section, and amends the description in the main computation section.
The maximum write off for an individual pool is displayed as a review point for guidance. Note that the software does not carry out any validation based on this figure.
The Short life assets schedule may be developed from this schedule.
This schedule has no standard supporting schedules.
On carry forward, tax written down values brought forward for the later period are linked automatically to the values carried forward.
Error | How to
solve it |
| Enter -ve amount | This error occurs when capital allowances are not being claimed. The disclaimed capital allowances figure needs to be entered as a negative number as entering a positive number actually increases the amount of capital allowances claimed instead of reducing them. |
| Check WDA disclaimer | This error occurs when the writing down allowances (WDA) disclaimed are in excess of the amount of WDAs actually available. Ensure that the WDAs disclaimed are not in excess of the actual WDAs. |
| Excess waiver | This error occurs when the writing down allowances (WDA) disclaimed are in excess of the amount of WDAs actually available. Ensure that the WDAs disclaimed are not in excess of the actual WDAs. |
| Cannot disclaim balancing allowance | Balancing allowances on the plant and machinery pool only occur when the company ceases to trade. Balancing allowances cannot be disclaimed when the trade ceases. |
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