Section 81 — Finance Act 2008: Small pools

Small pools 81 1 CAA 2001 is amended as follows.

2 In section 56(2) (amount of allowances and charges), before paragraph (a) insert—

za section 56A (small main pools and special rate pools), .

3 After section 56 insert— Writing-down allowances for small pools 56A 1 This section applies in relation to the main pool and the special rate pool.

2 Where the amount by which AQE exceeds TDR is less than or equal to the small pool limit, the amount of the writing-down allowance to which a person is entitled for a chargeable period is the amount by which AQE exceeds TDR.

3 The small pool limit is £1,000, except that—

a if the chargeable period is more or less than a year, it is proportionately increased or reduced, and b if the qualifying activity has been carried on for part only of the chargeable period, it is proportionately reduced.

4 A person claiming a writing-down allowance under this section may require the allowance to be reduced to a specified amount.

5 The Treasury may by order substitute for the amount for the time being specified in subsection (3) such other amount as it thinks fit.

6 An order under subsection (5) may make such incidental, supplemental, consequential and transitional provision as the Treasury thinks fit.

4 In section 59(1) (definition of unrelieved qualifying expenditure)—

a after “that period” insert “ (a) ” , and b after “TDR” insert , and b where section 56A(2) applies, the person does not claim a writing-down allowance of the amount by which AQE exceeds TDR.

5 The amendments made by this section have effect—

a for corporation tax purposes, in relation to chargeable periods beginning on or after 1 April 2008, and b for income tax purposes, in relation to chargeable periods beginning on or after 6 April 2008.