Part 2

Trading income
CHAPTER 5A

Trade profits: deductions allowable at a fixed rate

Expenditure on vehicles

Expenditure on vehicles
94D
1
This section applies if, in calculating the profits of a trade of a person for a period—
a
a deduction would otherwise be allowable for the period in respect of qualifying expenditure incurred in relation to a relevant vehicle (see subsection (2)), or
b
a deduction would be so allowable in respect of such expenditure but for the fact it is capital expenditure.
2
In this section “
relevant vehicle
” means a car, motor cycle or goods vehicle that—
a
is used for the purposes of the trade, and
b
is not an excluded vehicle (see section 94E).
3
The person may make a deduction under this section for the period in respect of the qualifying expenditure.
4
If a deduction for a period is made under this section—
a
no other deduction is allowed (for that or any other period) in respect of the qualifying expenditure, and
b
this section applies in relation to the relevant vehicle for every subsequent period for which the vehicle is used for the purposes of the trade.
5
The amount of the deduction is the appropriate mileage amount in relation to the relevant vehicle for the period (see section 94F).
6
In this section “
qualifying expenditure
”, in relation to a vehicle, means any expenditure incurred in respect of the acquisition, ownership, hire, leasing or use of the vehicle, other than incidental expenses incurred in connection with a particular journey.
7
For provision preventing capital allowances from being claimed in respect of qualifying expenditure incurred in relation to a relevant vehicle, see section 38ZA of
CAA
2001.
Pt. 2 Ch. 5A inserted (with effect in accordance with Sch. 5 para. 6 of the amending Act) by Finance Act 2013 (c. 29), Sch. 5 para. 2