Quick capital allowance q.

thehound

Hello, just looking at putting a new item down as a capital allowance. Can I just check... if I use the cash basis can I put the entire amount down as an expense?
Last time I had to do this years ago, you had a first year allowance and carried the rest forward for ever. Can't see anything about that on HMRC.
The allowable item is 4500, which is more than the business's income that year!
Thanks for any help.

[Deleted User]

Capital allowances including AIA are claimed as an expense. The ensuing loss can on,y be carried forward.

thehound

Thanks. But can I offset the loss sideways against other income, from employment? I can't see the business making any profit in the next few years as much of the business has transferred to employed earnings.

[Deleted User]

Not if you use the cash basis - see this thread:

https://forums.moneysavingexpert.com/discussion/5401503

thehound

Ahaa. Well the item I bought is easy to value as it is a musical instrument for a self employed musician so I guess I can easily go for whatever is not the cash basis. Could anyone run through how that works? Is it like the old days? i.e. put down a percentage this year carry the rest?
Thanks!

thehound

I decided to choose the non-cash basis. It accepted the whole amount as AIA and I get a rebate. I hope it is correct, but if anyone comes along to suggest I was mistaken, I will write to them and amend it.