This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

Capital Allowances Manual

Dredging: Outline

Dredging allowances write off capital expenditure incurred on dredging by a person carrying on a qualifying trade. For dredging, a qualifying trade has a wider meaning than it does for IBA. A trade which is a qualifying trade for IBA purposes or which consists of maintaining or improving the navigation of a harbour, estuary or waterway is a qualifying trade for dredging. The expenditure which qualifies for allowances is called qualifying expenditure and is written off at a rate of 4% on a straight-line basis. If the trade is permanently discontinued there is a balancing allowance that is equal to the expenditure not yet written off. There are no balancing charges. The deemed permanent discontinuance of a trade under ITTOIA/S18 or ICTA88/S337 (1) does not cause a balancing allowance; but the sale of the trade does unless the sale falls within ICTA88/S343 (2) or is a connected person sale or a sole or main benefit sale.