SCHEDULES

SCHEDULE 22 Tonnage tax

Part X The ring fence: capital allowances: ship leasing

Quantitative restrictions on allowances

94

1

Where the lessor under the F2... lease is entitled to capital allowances in respect of expenditure on the provision of the ship, the following provisions apply.

2

There is no entitlement to any F3annual investment allowance or first-year allowance.

3

The lessor is entitled—

C1a

in respect of the first F11£100 million of the cost of providing the ship, to writing-down allowances at F6the rate determined under sub-paragraph (3A) on the reducing balance, and

C3b

in respect of the next F11£100 million, to writing-down allowances at F10the rate specified in section 104D(1) of the Capital Allowances Act 2001 on the reducing balance.

F43A

The rate mentioned in sub-paragraph (3)(a) is—

a

if the rate of the writing down allowance to which the lessor would be entitled in respect of the expenditure apart from this paragraph is that specified in section 56(1) of the Capital Allowances Act 2001, that rate, and

b

otherwise, the rate specified in section 104D(1) of that Act.

C24

The expenditure F7... shall be allocated to separate pools F8in accordance with sub-paragraph (4A) and dealt with under F1Part 2 of the Capital Allowances Act 2001 in the same way as expenditure allocated to a class pool.

F9...

F54A

The expenditure is to be allocated to the following pools—

a

to the extent that it is expenditure in respect of which the lessor is entitled to writing down allowance at the rate specified in section 56(1) of the Capital Allowances Act 2001, a pool to be known as “the tonnage tax (main rate) pool”, and

b

to the extent that it is expenditure in respect of which the lessor is entitled to writing down allowance at the rate specified in section 104D(1) of that Act, a pool to be known as “the tonnage tax (special rate) pool”.

5

If the cost of providing the ship exceeds F12£200 million, the lessor is not entitled to capital allowances in respect of the excess.