Capital Allowances Act 2001 section 431

Discontinuance of trade

Section 431 provides that a person is entitled to a balancing allowance when their mineral extraction trade is permanently discontinued.

• When a mineral extraction trade is permanently discontinued, any remaining qualifying expenditure gives rise to a balancing allowance
• The balancing allowance applies for the chargeable period in which the discontinuance occurs
• This ensures that any unrelieved capital expenditure on mineral extraction is fully relieved upon cessation of the trade
• This is one of several circumstances (alongside other provisions in the Act) in which a balancing allowance arises for qualifying mineral extraction expenditure