Corporation Tax Act 2009 section 1233

Excess capital allowances

Section 1233 deals with what happens when a company with investment business has capital allowances that exceed the amount that can be relieved against its investment business profits, allowing the excess to be treated as management expenses.

• Applies to companies with investment business that qualify for capital allowances because managing investments is a qualifying activity
• Capital allowances are normally deducted first against the profits of the investment business itself
• Any excess allowances that cannot be relieved against investment business profits are reclassified as management expenses
• The reclassified expenses are allocated to the accounting period for which the company was entitled to those allowances