You must use writing down allowances if:
- you’ve already claimed AIA on items worth a total of more than the AIA amount
- the item doesn’t qualify for AIA, eg cars, gifts or things you owned before you used them in your business
You deduct a percentage of the value from your profits each year when you use writing down allowances.
The percentage you deduct depends on the item. For business cars the rate depends on their CO2 emissions.
Work out the value of your item
In most cases, the value is what you paid for the item. Use the market value (the amount you’d expect to sell it for) instead if:
- you owned it before you started using it in your business
- it was a gift
How to claim
Group the things you’ve bought into ‘pools’ based on the percentage rate they qualify for.
The amount left in each pool becomes the starting balance for the next accounting period.