Balancing Allowance

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October 4, 2015 at 7:37 am #274885
Muslim Farooque
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Hello,

I was confused regarding balancing allowance I’m capital allowances that is balancing allowance subtracted from overall capital allowance and balancing charge(negative) added ?
October 5, 2015 at 5:29 pm #275060
Tax Tutor
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No – if a balancing charge arises then this will reduce the capital allowances and hence increase the trading profit. If a balancing allowance arises then it will be added to the capital allowances and hence will reduce profits for tax purposes.
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