Capital Allowances Act 2001 section 456

Pooling of expenditure

Section 456 establishes the requirement to pool qualifying expenditure on research and development for the purposes of calculating capital allowances and balancing adjustments.

• Qualifying expenditure on research and development must be allocated to a pool before allowances or charges can be calculated.
• Pooling is the mechanism used to determine entitlement to writing-down allowances and balancing allowances, and liability to balancing charges.
• Each trade carried on by a person that has qualifying expenditure must have its own separate pool.
• Where a person carries on more than one trade, expenditure from different trades cannot be combined into a single pool.