112. Giving effect to allowances and charges generally.

The method of giving effect, in calculating the profits of a qualifying activity1, to an allowance or charge to which a person is entitled for a chargeable period2 depends on the nature of that activity, as follows:

  1.  

    (1)     if the qualifying activity is a trade3, by treating the allowance as an expense of the trade and the charge as a receipt of the trade4;

  2.  

    (2)     if the qualifying activity is an ordinary UK property business5, by treating the allowance as an expense of that business and the charge as a receipt of that business6;

  3.  

    (3)     if the qualifying activity