Policy paper

Cash basis: treatment of capital

This measure replaces a general prohibition on deductions for capital expenditure in calculating taxable profits using the cash basis.

• From: HM Revenue & Customs
• Published: 31 January 2017
• Last updated: 31 January 2017
  Show all updates

  1. 31 January 2017

     The Income Tax (Relevant Maximum for Calculating Trade Profits on the Cash Basis) Order 2017 and explanatory memorandum have been added to this page.

  2. 31 January 2017

     First published.

Documents

Reforming the cash basis expenditure rules

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Draft legislation: cash basis - treatment of capital

PDF, 55.7 KB, 3 pages

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Explanatory note for cash basis: treatment of capital

PDF, 147 KB, 3 pages

Details

This clause replaces a general prohibition on deductions for capital expenditure in calculating taxable profits using the cash basis, with a more focused and limited prohibition on deductions for certain specified capital expenditure.

Comments about this legislation should be send to John Banks by email: john.banks1@hmrc.gsi.gov.uk by 28 February 2017.

Secondary legislation on increasing the cash basis thresholds for unincorporated businesses has also been published.