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Ask the Tutor ACCA TX-UK

Private use car in partnership

SASayeda Amal2mo ago
The question relates to Section C question-Poppy. Poppy used a car for both private and business purposes. TWDV was 8400 And disposal was 5400 Private use was 70% After calculating capital allowances, there was a balancing allowance. In an earlier post I've posted a question regarding special rate pool disposal. And after the disposal we still had to calculate 6% on the balance. In this case, we're calculating balancing allowance. Is it because it's a private use car? And also in short life assets we have balancing allowance and balancing charge. Can you guide me through this? It's a bit confusing. Thank you.
AmandaPAmandaPTutor2mo ago#1
When assets with their own column (private use and SLAs) are disposed of, a balancing charge or balancing allowance arises. It's only the main pool and SRP that a balancing allowance can only arise in the period of cessation of the business (coursenotes, page 55)
SASayeda Amal2mo ago#2
I got it now. Thank you. :)
AmandaPAmandaPTutor2mo ago#3
No problem.
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