Capital Allowances Act 2001 section 306

Amount of initial allowance and period for which allowance made

Section 306 sets out the amount of the initial allowance available for qualifying enterprise zone expenditure and identifies the chargeable period in which the allowance is given.

• The initial allowance is 100% of qualifying enterprise zone expenditure, but a claimant may elect to reduce it to a lesser specified amount.
• The allowance is made for the chargeable period in which the qualifying expenditure is incurred.
• Where expenditure is incurred before a trade, profession, or vocation has started, it is treated as incurred on the first day the activity begins.
• This deemed-timing rule ensures there is a chargeable period against which the initial allowance can be set, even for pre-trading costs.