Capital Allowances Act 2001 section 349

Additional VAT rebates and writing-down allowances

Section 349 deals with what happens to writing-down allowances when a person holding the relevant interest in a property receives an additional VAT rebate relating to qualifying expenditure, and the unwritten-down balance of that expenditure is at least as large as the rebate.

• The section applies where an additional VAT rebate is received by the person entitled to the relevant interest in relation to the qualifying expenditure concerned.
• The section only applies where the residue (unwritten-down balance) of the qualifying expenditure, immediately before the rebate accrues, equals or exceeds the rebate amount.
• When these conditions are met, the additional VAT rebate is treated as a relevant event for the purpose of recalculating writing-down allowances under section 311.
• The relevant event is treated as occurring at the time the rebate accrues, so future writing-down allowances are adjusted from that point onwards to reflect the reduced expenditure base.