Section 56 Amount of allowances and charges

United Kingdom

(1)

The amount of the writing-down allowance to which a person is entitled for a chargeable period is F114% of the amount by which AQE exceeds TDR.

F2(1A)

But in relation to qualifying expenditure incurred wholly for the purposes of a ring fence trade in respect of which tax is chargeable under F3section 330(1) of CTA 2010 (supplementary charge in respect of ring fence trades), the amount of the writing-down allowance to which a person is entitled for a chargeable period is 25% of the amount by which AQE exceeds TDR.

(2)

F4Subsections (1) and (1A) are subject to—

F5(za)

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

F6(a)

section 104D (special rate expenditure: F7F86% or 10%), and

(b)

section 109 (overseas leasing: 10%).

(3)

If the chargeable period is more or less than a year, the amount is proportionately increased or reduced.

(4)

If the qualifying activity has been carried on for part only of the chargeable period, the amount is proportionately reduced.

(5)

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

(6)

The amount of the balancing charge to which a person is liable for a chargeable period is the amount by which TDR exceeds AQE.

(7)

The amount of the balancing allowance to which a person is entitled for the final chargeable period is the amount by which AQE exceeds TDR.

Annotations

Textual amendments

F1: Word in s. 56(1) substituted (with effect in accordance with s. 28(2)-(6) of the amending Act) by Finance Act 2026 (c. 11), s. 28(1)
F2: S. 56(1A) inserted (with effect in accordance with s. 80(8)-(12) of the amending Act) by Finance Act 2008 (c. 9), s. 80(3)
F3: Words in s. 56(1A) substituted (1.4.2010) (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 326 (with Sch. 2)
F4: Words in s. 56(2) substituted (with effect in accordance with s. 80(8) of the amending Act) by Finance Act 2008 (c. 9), s. 80(4)
F5: S. 56(2)(za) inserted (with effect in accordance with s. 81(5) of the amending Act) by Finance Act 2008 (c. 9), s. 81(2)
F6: S. 56(2)(a) substituted (with effect in accordance with Sch. 26 para. 14 of the amending Act) by Finance Act 2008 (c. 9), Sch. 26 para. 4
F7: Words in s. 56(2)(a) inserted (with effect in accordance with s. 10(8)-(13) of the amending Act) by Finance Act 2011 (c. 11), s. 10(4)(b)
F8: Word in s. 56(2)(a) substituted (with effect in accordance with s. 31(4)(8) of the amending Act) by Finance Act 2019 (c. 1), s. 31(3)(a)

Notes on Part 2

Modifications

C1: Pt. 2 modified (24.2.2003) by Proceeds of Crime Act 2002 (c. 29), s. 458(1), Sch. 10 para. 12 (with Sch. 10 para. 17(1)); S.I. 2003/120, art. 2, Sch. (with arts. 3 4) (as amended (20.2.2003) by S.I. 2003/333, art. 14)
C2: Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 paras. 10, 22 (with s. 38(2) ); S.I. 2004/2575 , art. 2(1) , Sch. 1
C3: Pt. 2 modified (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 paras. 9(2), 21(2) (with s. 38(2)); S.I. 2004/2575, art. 2(1) , Sch. 1
C4: Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 4 para. 4 ; S.I. 2004/2575 , art. 2(1) , Sch. 1
C5: Pt. 2 modified (22.7.2008) by Crossrail Act 2008 (c. 18), Sch. 13 para. 19
C6: Pt. 2 modified (22.7.2008) by Crossrail Act 2008 (c. 18), Sch. 13 para. 35
C7: Pt. 2 modified (22.7.2008) by Crossrail Act 2008 (c. 18), Sch. 13 paras. 36, 37
C8: Pt. 2 modified (21.7.2009) by Finance Act 2009 (c. 10), s. 24
C9: Pt. 2 modified (17.7.2013) by Finance Act 2013 (c. 29), s. 73(7)-(11) (with s. 73(6))
C10: Pt. 2 modified (10.6.2021) by Finance Act 2021 (c. 26), s. 9(1)(a)

Notes on Chapter 5

Modifications

C1: Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 paras. 10, 22 (with s. 38(2) ); S.I. 2004/2575 , art. 2(1) , Sch. 1
C2: Pt. 2 modified (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 paras. 9(2), 21(2) (with s. 38(2)); S.I. 2004/2575, art. 2(1) , Sch. 1
C3: Pt. 2 modified (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 para. 21(2) (with s. 38(2) ); S.I. 2004/2575 , art. 2(1) , Sch. 1
C4: Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 para. 10 (with s. 38(2) ); S.I. 2004/2575 , art. 2(1) , Sch. 1
C5: Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 4 para. 4 ; S.I. 2004/2575 , art. 2(1) , Sch. 1
C6: Pt. 2 modified (17.7.2013) by Finance Act 2013 (c. 29), s. 73(7)-(11) (with s. 73(6))
C7: Pt. 2 modified (11.7.2023) by Finance (No. 2) Act 2023 (c. 30), s. 7