Explanatory Notes

Income Tax (Trading and Other Income) Act 2005

2005 CHAPTER 5

24 March 2005

Commentary on Sections

Part 2: Trading income

Chapter 11: Trade Profits: Other specific trades
Section 170: Deduction for capital expenditure

702.This section provides for a deduction for certain capital expenditure incurred by the trader or a predecessor. It is based on section 91(1), (4) to (7) and (9) of ICTA.

703.Section 91 of ICTA refers to “land” in a cemetery or crematorium. Subsection (1) of this section refers instead to “an interest in” such land. This accommodates better the possibility that operators of cemeteries and crematoria might sometimes hold land in leasehold rather than in freehold form.

704.Subsection (3)(a) is based on section 91(6) of ICTA which prohibits deductions in respect of the same expenditure under both section 91(1)(a) and section 91(1)(b) of ICTA.