Capital Allowance

They don’t qualify because basically the government says they don’t qualify.What is important to bear in mind is that capital allowances are totally separate from depreciation even though in effect they are “government sanctioned” depreciation, for want of a better description.There have been a number of legal cases hedging on disputes on what assets qualify for capital allowances.Often these cases have been about whether an asset performs an active function in the business and should therefore attract capital allowance or whether performs a passive function in which case it is ineligible for capital allowance.Depreciation is merely the means by which an organisation allocates the cost of an asset over its useful life.If you have any other questions please feel free to ask.