Capital Allowances Act 1990

100 Balancing charges: excess of allowances etc. over expenditure

(1) If, for any chargeable period for which a person is required to bring into account a disposal receipt in respect of qualifying expenditure incurred by him, the aggregate of—

(a) the disposal receipts in respect of that expenditure which he is required to bring into account for that period, and

(b) any disposal receipts in respect of that expenditure which he was required to bring into account for earlier chargeable periods, and

(c) the net amount of the allowances made to him for earlier chargeable periods under section 98 in respect of that expenditure,

exceeds the expenditure concerned, there shall be made on him a charge (“a balancing charge”).

(2) In relation to any qualifying expenditure, the amount on which a balancing charge is made for a chargeable period shall be whichever is the less of—

(a) the amount by which the aggregate referred to in subsection (1) above exceeds the expenditure; and

(b) the net amount of the allowances made as mentioned in subsection (1)(c) above.

(3) In relation to any chargeable period, the net amount of the allowances made to any person for earlier chargeable periods under section 98 in respect of expenditure incurred by him means the total of those allowances less the total of the amounts on which balancing charges have been made on him for earlier chargeable periods, being charges arising by reason of his bringing into account disposal receipts in respect of that expenditure.