|
| |
|
94C | Provisions not applicable to certain firms |
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| The provisions of this Chapter do not apply in calculating the profits |
| |
of a trade carried on by a firm for a period if one or more of the |
| |
persons who have been partners in the firm at any time during the |
| |
period was not an individual at that time. |
| 5 |
| |
94D | Expenditure on vehicles |
| |
(1) | This section applies if, in calculating the profits of a trade of a person |
| |
| |
(a) | a deduction would otherwise be allowable for the period in |
| 10 |
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 |
| 15 |
| |
(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. |
| 20 |
(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 |
| 25 |
| |
(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, |
| 30 |
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. |
| 35 |
| |
(1) | A car, motor cycle or goods vehicle that is used for the purposes of a |
| |
trade is an “excluded vehicle” for the purposes of section 94D if |
| |
condition A or B is met in relation to the vehicle. |
| |
(2) | Condition A is that the person who is or has been carrying on the |
| 40 |
trade has at any time claimed any capital allowances under Part 2 of |
| |
CAA 2001 in respect of any expenditure incurred on the provision of |
| |
| |
| |
|
| |
|
| |
|
(a) | the vehicle is a goods vehicle or a motor cycle, and |
| |
(b) | any of the expenditure incurred on acquiring the vehicle has |
| |
been deducted in calculating the profits of the trade for a |
| |
period on the cash basis (see section 25A). |
| |
94F | The appropriate mileage amount |
| 5 |
(1) | In calculating the profits of a trade for a period, the appropriate |
| |
mileage amount in relation to a relevant vehicle for the period is—![equation: cross[char[M],char[R]]](missing.gif) |
| |
| |
M is the number of miles of business journeys made by a person |
| |
(other than as a passenger) using that vehicle in the period, |
| 10 |
| |
R is the rate applicable to that kind of vehicle. |
| |
(2) | The rates applicable are as follows— |
| |
| |
| | | | 15 | | | 45p for the first 10,000 miles |
| | | | | | | | | | | | |
|
(3) | In a case where the total number of miles of relevant business |
| |
journeys made in the period is greater than 10,000, the rate of 45p per |
| 20 |
mile is available only in relation to 10,000 of those miles. |
| |
(4) | “Relevant business journey” means any business journey made in |
| |
the period by a car or goods vehicle— |
| |
(a) | that is used for the purposes of the trade, and |
| |
(b) | in relation to which section 94D applies for the period. |
| 25 |
| |
“business journey”, in relation to a vehicle used for the purposes |
| |
of a trade, means any journey, or any identifiable part or |
| |
proportion of a journey, that is made wholly and exclusively |
| |
for the purposes of the trade, and |
| 30 |
“relevant vehicle” has the same meaning as in section 94D. |
| |
(6) | The Treasury may by regulations amend subsection (2) so as to alter |
| |
| |
| Regulations under this subsection may also make consequential |
| |
amendments to subsection (3). |
| 35 |
94G | Definitions of types of vehicle |
| |
(1) | This section applies for the purposes of sections 94D to 94F (and this |
| |
| |
(2) | “Car” means a mechanically propelled road vehicle which is not— |
| |
|
| |
|
| |
|
| |
| |
(c) | an invalid carriage, or |
| |
(d) | a vehicle of a type not commonly used as a private vehicle |
| |
and unsuitable to be so used. |
| 5 |
(3) | “Goods vehicle” means a mechanically propelled road vehicle |
| |
| |
(a) | is of a construction primarily suited for the conveyance of |
| |
goods or burden of any description, and |
| |
(b) | is not a motor cycle. |
| 10 |
(4) | “Motor cycle” has the meaning given by section 185(1) of the Road |
| |
| |
(5) | For the purposes of this section “invalid carriage” has the meaning |
| |
given by section 185(1) of the Road Traffic Act 1988. |
| |
Use of home for business purposes |
| 15 |
94H | Use of home for business purposes |
| |
(1) | This section applies if, in calculating the profits of a trade of a person |
| |
for a period, a deduction (“the standard deduction”) would |
| |
otherwise be allowable for the period in respect of the use of the |
| |
person’s home for the purposes of the trade. |
| 20 |
(2) | The person may, instead of making the standard deduction, make a |
| |
deduction for the period under this section. |
| |
(3) | The amount of the deduction allowable for the period is the sum of |
| |
the applicable amounts for each month, or part of a month, falling |
| |
| 25 |
(4) | The applicable amount for a month, or part of a month, is given by |
| |
| |
| |
|
| where the “number of hours worked” in a month (or part of a month) |
| |
is the number of hours spent wholly and exclusively on work done |
| |
by the person, or any employee of the person, in the person’s home |
| 35 |
wholly and exclusively for the purposes of the trade. |
| |
(5) | If the person has more than one home, this section has effect as if |
| |
those homes were a single home. |
| |
|
| |
|
| |
|
(6) | The Treasury may by regulations amend subsection (4) so as to alter |
| |
| |
Premises used both as home and business premises |
| |
94I | Premises used both as a home and as business premises |
| |
(1) | This section applies if— |
| 5 |
(a) | a person carries on a trade at any premises, |
| |
(b) | the premises are used mainly for the purposes of carrying on |
| |
the trade, but are also used by the person as a home, |
| |
(c) | the person incurs expenses in relation to the premises, |
| |
(d) | the expenses are incurred mainly (but not wholly and |
| 10 |
exclusively) for the purposes of the trade, and |
| |
(e) | in calculating the profits of the trade for a period, a deduction |
| |
(“the standard deduction”) would otherwise be allowable for |
| |
the period in respect of a part or proportion of the expenses |
| |
in accordance with section 34(2). |
| 15 |
(2) | The person may, instead of making the standard deduction, make a |
| |
deduction for the period under this section. |
| |
(3) | The amount of the deduction allowable for the period is the amount |
| |
of the expenses less the non-business use amount. |
| |
(4) | The non-business use amount is the sum of the applicable amounts |
| 20 |
for each month, or part of a month, falling within the period. |
| |
(5) | The applicable amount for a month, or part of a month, is given by |
| |
| |
| |
|
(6) | For the purposes of subsection (5) “relevant occupant”, in relation to |
| 30 |
a month (or part of a month), means an individual who, at any time |
| |
during that month (or that part of a month)— |
| |
(a) | occupies the premises as a home, or |
| |
(b) | stays at the premises otherwise than in the course of the |
| |
| 35 |
(7) | The Treasury may by regulations amend subsection (5) so as to alter |
| |
the rates or rate bands.” |
| |
3 | In section 31 (relationship between rules prohibiting and allowing |
| |
deductions), in subsection (2), after paragraph (a) insert— |
| |
| 40 |
|
| |
|
| |
|
4 | In Chapter 18 (post-cessation receipts), in section 254 (allowable |
| |
deductions), after subsection (2A) (inserted by paragraph 39 of Schedule 4) |
| |
| |
| |
(a) | the loss or expense is incurred, or the debit arises, in relation |
| 5 |
| |
(b) | immediately before the person permanently ceases to carry |
| |
on the trade, section 94D (deduction allowable at fixed rate |
| |
for expenditure on vehicles) applies in relation to the vehicle, |
| |
| assume for the purposes of subsection (2) that that section applies in |
| 10 |
relation to the vehicle.” |
| |
5 (1) | Part 2 of CAA 2001 (plant and machinery allowances) is amended as follows. |
| |
(2) | In Chapter 3 (qualifying expenditure), after section 38 insert— |
| |
“38ZA | Vehicles for which deductions allowed at fixed rate under Part 2 of |
| |
| 15 |
| Expenditure is not qualifying expenditure if— |
| |
(a) | it is incurred in respect of a vehicle in a period, and |
| |
(b) | a deduction is made for the period in respect of the |
| |
expenditure under section 94D of ITTOIA 2005 (deduction |
| |
allowable at fixed rate for expenditure on vehicles).” |
| 20 |
(3) | In Chapter 5 (allowances and charges), in section 59 (unrelieved qualifying |
| |
expenditure), at the end insert— |
| |
“(8) | Subsection (9) applies if— |
| |
(a) | a person carrying on a trade, profession or vocation incurs |
| |
expenditure in relation to a vehicle, |
| 25 |
(b) | at the end of the basis period for a tax year, the person has |
| |
unrelieved qualifying expenditure incurred in relation to the |
| |
vehicle to carry forward from the chargeable period ending |
| |
with that basis period (“the relevant chargeable period”), |
| |
(c) | in calculating the profits of a trade, profession or vocation of |
| 30 |
a person for the following tax year, a deduction is made |
| |
under section 94D of ITTOIA 2005 in respect of expenditure |
| |
incurred in relation to the vehicle, and |
| |
(d) | the person does not enter the cash basis for that tax year. |
| |
(9) | None of the unrelieved qualifying expenditure incurred in relation |
| 35 |
to the vehicle may be carried forward as unrelieved qualifying |
| |
expenditure from the relevant chargeable period. |
| |
(10) | Where a person has unrelieved qualifying expenditure to carry |
| |
forward from a chargeable period that is not expenditure allocated to |
| |
a single asset pool, the amount of the unrelieved qualifying |
| 40 |
expenditure incurred in relation to the vehicle is to be determined on |
| |
such basis as is just and reasonable in all the circumstances.” |
| |
6 | The amendments made by this Schedule have effect for the tax year 2013-14 |
| |
and subsequent tax years. |
| |
|
| |
|