PIM4472 - Property allowance: contents: other considerations: capital allowances

If an individual uses the property allowance they are not allowed to deduct any allowable expenditure from their profits for the same period, including any capital allowances.

It is up to the individual to determine for each tax year whether to use the property allowance or to deduct allowable expenditure, including capital allowances.

If an individual uses the property allowance and in later periods opts to claim capital allowances, the normal rules for capital allowances for property businesses apply (see PIM3010 onwards).

Capital allowances may still be available in later years in respect of capital expenditure incurred in a year in which the property allowance applied as qualifying capital expenditure incurred in one chargeable period may be pooled, and writing down or balancing allowances claimed in a return for a later period. Guidance on pooling expenditure can be found at CA23210.