Capital Allowances Act 2001 section 134

Deferment of balancing charges: introduction

Section 134 introduces the rules that allow a balancing charge arising on the disposal of a ship to be deferred and redirected towards qualifying expenditure on a replacement ship.

• When a ship is disposed of and a balancing charge arises, the charge does not have to be recognised immediately.
• The balancing charge can be deferred and attributed to qualifying expenditure on another ship.
• The detailed deferment rules are contained in sections 135 to 156 of the Capital Allowances Act 2001.
• The term "the deferment rules" is used throughout the chapter to refer collectively to sections 135 to 156.