Readers' forum : Funeral direction

Our clients are two companies which both operate as funeral directors and are controlled by the same individual.

The companies are thinking of replacing their hearses and limos in 2017 at a cost of £250 000 for each business. However one company’s year-end is 30 November and the other is 28 February. The query centres on the annual investment allowance (AIA) and the restriction that applies under CAA 2001 s 51E: ‘Fourth Restriction: other companies under common control.’

Having researched the position we cannot find any clear commentary on how s 51E operates for companies caught under this section but with different year-ends.

We conclude that because reference is made to the financial year in s 51E this refers to financial years for corporation tax and chargeable periods ending in that year. It appears a workable plan to maximise the AIA that would be available to...