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HMRC internal manual

Capital Allowances Manual

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HM Revenue & Customs
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Dredging: Rate of WDA

CAA01/S487 (3) - (4)

The annual rate of WDA is 4% unless the qualifying expenditure was incurred before 6 November 1962. If the qualifying expenditure was incurred before 6 November 1962 the annual rate of WDA is 2%.

If the chargeable period is more or less than a year the WDA is increased or reduced proportionately. For example, if the chargeable period is 9 months long the rate of WDA is 3% = 4% x 9/12.

If the chargeable period is only partly within the writing down period you treat the part within the writing down period as a separate chargeable period when you calculate the rate of WDA.

Example In the example at CA81100 the writing down period ends on 23 May 2026. If Doug draws up accounts for the year ended 23 February 2027 the part of that chargeable period which is within the writing down period is the three-month period from 24 February 2026 to 23 May 2026. The rate of WDA for the year ended 23 February 2027 is therefore 1% = 4% x 3/12.