Capital Allowances Act 2001 section 377

Chargeable period when balancing adjustment made

Section 377 prevents a person from claiming a writing-down allowance in any chargeable period in which a balancing adjustment is made in respect of the same qualifying expenditure.

• A writing-down allowance cannot be claimed for a chargeable period in which a balancing allowance or balancing charge arises on the same expenditure.
• This applies whether the balancing adjustment is a balancing allowance (in the taxpayer's favour) or a balancing charge (creating additional taxable income).
• The restriction relates specifically to the qualifying expenditure that is the subject of the balancing adjustment.
• The rule prevents a double benefit or overlap between ongoing writing-down allowances and the final balancing adjustment for the same expenditure in the same period.