Capital allowances: During tonnage tax (P&M)
Mixed use assets acquired after entry
A tonnage tax company may incur expenditure on a new item of plant or machinery that is used partly for its tonnage tax trade and partly for another (non tonnage tax) trade. The company will not be entitled to capital allowances in respect of the use of the asset in the tonnage tax trade, but it will be entitled to capital allowances in respect of its use in the non-tonnage tax trade.
In such a case the capital allowances are calculated using the normal rules for assets which are used partly for trade and partly for non-business purposes (seeCA27005).
For this purpose any use of the asset for tonnage tax purposes is to be treated as if it were non-trade use.
|FA00/SCH22/PARA73 (new expenditure partly for tonnage tax)||TTM17406|