Section 101: Meaning of “capital allowance excess”
358.This section explains which capital allowances are available for relief. It is based on section 403ZB of ICTA.
359.Subsection (1) is the link to the basic rule in section 99(1)(b). It identifies the capital allowances as those to be given in a qualifying activity of “special leasing”.
360.A company may surrender the allowances which would otherwise be available for relief against its total profits under section 260 of CAA.
361.Subsections (3) and (4) set out how to deal with “special leasing” allowances that are brought forward:
the amount to be surrendered is limited to the allowances for the current period, without regard to any allowances brought forward; and
in calculating the excess of allowances over the leasing income of the current period, the amount of the income is not reduced by allowances brought forward.
