The following Corporation Tax guidance note by Tolley provides comprehensive and up to date tax information covering:
Capital allowances are received in the accounting period in which expenditure on plant and machinery is 'incurred'.
The normal rule is that expenditure is incurred on the date on which the obligation to pay becomes unconditional. This may be set by the contract to purchase the plant and machinery.
Where there is no contract, or the contract contains no specific agreement as to terms of payment, a person buying goods is legally required to pay for them on delivery. Therefore in most cases expenditure is incurred when the goods are delivered.
There is an exception to the general rule. If there is a gap of more than four months between:
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login