Renewals allowance abolished

The renewals allowance for property businesses is to be repealed.

It predates capital allowances and was intended to allow the costs of replacing implements, utensils and articles used in a business. But, according to the Treasury, some businesses have recently used it to claim relief for expenditure on large and expensive items of equipment.

Alternative provisions now provide relief for this type of expenditure under the capital allowances regime or the new replacement relief for landlords.

The measure will have effect for expenditure incurred on or after 6 April 2016 for income tax and from 1 April 2016 for corporation tax.
 

Issue: 4543 / Categories: Tax cases , Budget/Finance Act , Business , Capital allowances , Land & property