Corporation Tax Act 2009 section 68

Replacement and alteration of trade tools

Section 68 allows a deduction for the cost of replacing or altering tools used in a trade, even where the expenditure would otherwise be disallowed as capital.

• A deduction is available for the cost of replacing or altering tools, implements, utensils or other articles used for trade purposes.
• This relief applies only where the sole reason a deduction would be denied is that the expenditure is capital in nature.
• Expenditure on repairing trade tools or premises is generally treated as revenue expenditure under normal rules and does not need this specific provision.
• Provisions (accruals) for future repair costs are also deductible where the underlying repairs themselves would qualify for a deduction.