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ABAs - single site

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See Also

ABAs - multi site | ABAs - underlying site | Disposals | Fixed assets


External Links

HMRC Manuals - Agricultural Buildings Allowance (ABA): Contents


Select from the following headings:

Background | Developing the schedule | Completing the Schedule | Standard Sub-Schedules | Carry Forward | Related Errors


Background

Agricultural buildings allowances (ABAs) give relief for the capital cost of constructing an agricultural building or other works.

This schedule provides ABA calculations for a single site.

Total additions and disposals are reconciled to fixed assets data entered.

The investment company variant of the schedule is identical to the trading company version, except that allowances are treated as allowances by discharge or repayment of tax. For long periods of account, the movement is duplicated in the stub period.

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Developing the schedule

For trade income, the schedule is developed from the Fixed assets schedule.

For UK property businesses, a version of this schedule can be developed from the Rental Income schedule.

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Completing the schedule

Date, Description and Original cost
The user is required to enter for each row, with typically one row per year of additions, details of the year of acquisition and the qualifying original cost.

Note that for a new building, the cost must be entered in the Original cost column and in the additions column; otherwise no allowance will be calculated.

Annual WDA rate (override)
The default rate set for writing down allowances (WDA) is set as 4% for files before FY2012 and 0% for FY2012 files and onwards. This can be altered as appropriate for old or secondhand buildings. The calculation of writing down allowances takes account of the length of the period. Where necessary, a rate for initial allowances can be entered.

Phasing out of agricultural buildings allowance
The allowance for agricultural buildings is going to be progressively reduced from 1 April 2008 and will be withdrawn from April 2011. Therefore the WDA will be reduced by 25% for FY 2008, 50% for FY 2009, 75% for FY 2010 and will be withdrawn completely thereafter.

Relevant proceeds
In the case of a disposal, the proceeds entered must relate to the whole of the expenditure on the row concerned. Thus, if there is a part-disposal of an item of expenditure previously entered on one row, the expenditure should be split between two rows before processing the disposal. The proceeds entered should be limited to cost.

Balancing event election made
If this flag is set to Yes, then it will be assumed that both parties have elected to treat the disposal as a balancing event. In this case, the balancing allowance or balancing charge is calculated automatically.

If the flag is set to No then the ABAs for the year will be time apportioned according to the date of disposal. An error will occur if no date of disposal is entered, or the date of disposal is not in the period.

Allowances withdrawn?
If allowances have been claimed in the period between construction starting and the building being brought into use, and the first use of the building is not agricultural, then the allowances are withdrawn once the building comes into use. Setting this flag to Yes will remove the building from the computation. However, the previous year's file must be amended to reflect this situation if necessary.

Writing down allowances (WDA) waived

By default any writing down allowances (WDA) waived are apportioned across assets automatically. For FY 2005 files and onwards it is possible to manually allocate WDA waived across individual assets by means of a selector on the schedule. Data entry cells will be displayed for this purpose.

Investment companies
The investment company variant of the schedule is identical to the trading company version, except that allowances are treated as allowances by discharge or repayment of tax. For long periods of account, the movement is duplicated for the stub period.

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Standard sub-schedules

This schedule has no standard supporting schedules.

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Carry forward

The software will carry forward the descriptions, original cost, date of purchase and residue of each building when the new period is built.

Rows where allowances are withdrawn or where disposal proceeds have been entered will not carry forwards.

 

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Related errors

Error
How to solve it
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.

Sign error

This error results from the sign conventions used within the software. This error can be resolved by clicking the

button.

Allowances waived should be positive

This error results from the sign conventions used within the software. Agricultural buildings allowances (ABA) are deducted from the profit before tax to arrive at profits chargeable to corporation tax. If the allowances waived are entered as a negative number, this actually increases the ABAs claimed in this accounting period instead of deferring them until future accounting periods. This error can be resolved by clicking the button.

Remove manually entered values above or select to manually allocate WDA waivedFor FY 2005 files and onwards where the user has selected not to manually allocate writing down allowances (WDA) waived but has made manual entries these entries are not relevant and should be removed.

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