Capital Allowances Act 2001 section 393L

Meaning of "the residue of qualifying expenditure"

Section 393L defines the concept of "the residue of qualifying expenditure" for the purposes of mineral extraction allowances, explaining how to calculate the unrelieved balance of original qualifying expenditure after deducting allowances previously given.

• The residue of qualifying expenditure represents the remaining balance of original qualifying capital expenditure on mineral extraction that has not yet been relieved through capital allowances.
• It is calculated by taking the total qualifying expenditure incurred and subtracting all capital allowances (such as writing-down allowances and balancing allowances) that have previously been made in respect of that expenditure.
• The calculation must also take account of any balancing charges that have been made, which effectively add back amounts to the residue.
• This definition was amended by Finance Act 2012, Schedule 39, paragraph 37, and is relevant whenever the residue figure is needed for other mineral extraction allowance calculations, such as balancing adjustments on disposal or cessation events.