Part 1

Charges, rates, allowances etc

Capital allowances

Plant and machinery writing-down allowances
10
1
Part 2 of CAA 2001 (plant and machinery allowances) is amended as follows.
2
In section 56 (amount of allowances and charges), in subsection (1) for “20%” substitute “ 18% ”.
3
In section 104D (writing-down allowances: special rate expenditure)—
a
in subsection (1) for “10%” substitute “ 8% ”, and
b
after that subsection insert—
1A
But, in relation to special rate expenditure incurred wholly for the purposes of a ring fence trade in respect of which tax is chargeable under section 330(1) of CTA 2010 (supplementary charge in respect of ring fence trades), the amount of the writing-down allowance to which a person is entitled for a chargeable period is 10% of the amount by which AQE exceeds TDR.
4
Accordingly—
a
in the heading for section 104D, after “at” insert “ 8% or ”, and
b
in sections 56(2)(a) and 104E(1)(a), before “10%” insert “ 8% or ”.
5
Part 10 of Schedule 22 to FA 2000 (companies within tonnage tax: capital allowances in respect of ship leasing), as it has effect (by virtue of section 57(9) of this Act) in relation to expenditure incurred before 1 January 2011, is amended as follows.
6
In each of the following provisions, for “20%” (in each place) substitute “ 18% ”
a
paragraph 94(3)(a) and (4),
b
paragraph 95(4),
c
paragraph 97(2) and (3),
d
paragraph 98(8), and
e
paragraph 99(2) and (5).
7
In each of the following provisions, for “10%” substitute “ 8% ”
a
paragraph 94(3)(b) and (4),
b
paragraph 95(4),
c
paragraph 97(2), (3) and (4),
d
paragraph 98(8), and
e
paragraph 99(2).
8
The amendments made by this section have effect in relation to—
a
chargeable periods beginning on or after the relevant day, and
b
chargeable periods beginning before, and ending on or after, the relevant day.
9
But in respect of a chargeable period within subsection (8)(b), they have effect as if—
a
in section 56(1) of CAA 2001 and the provisions of Schedule 22 to FA 2000 mentioned in subsection (6), references to 18% were references to X%, and
b
in section 104D(1) of CAA 2001 and the provisions of Schedule 22 to FA 2000 mentioned in subsection (7), references to 8% were references to Y%.
10
For the purposes of subsection (9)—
X = (20 BRD/CP) + (18 ARD/CP)
Y = (10 BRD/CP) + (8 ARD/CP)
11
Where X or Y would be a figure with more than 2 decimal places, it is to be rounded up to the nearest second decimal place.
12
In subsection (10)—
- BRD is the number of days in the chargeable period before the relevant day,
- ARD is the number of days in the chargeable period on and after the relevant day, and
- CP is the number of days in the chargeable period.
13
The relevant day is—
a
for corporation tax purposes, 1 April 2012, and
b
for income tax purposes, 6 April 2012.