Revenue Note for Guidance

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Revenue Note for Guidance

669B Annual allowances for capital expenditure on purchase of milk quota

Summary

This is the substantive section of the Chapter and provides that qualifying expenditure (see definition in section 669A) incurred on the purchase of a qualifying milk quota may be written off over a 7 year period at the rate of 15 per cent per annum over 6 years and 10 per cent in year 7. In the case of a short chargeable period, as in the case of commencements and cessations, the allowance will be reduced accordingly.

Details

(1) A writing down allowance is given to a person engaged in the trade of farming in respect of qualifying expenditure incurred on the purchase of a qualifying quota.

(2) The qualifying period is 7 years commencing with the chargeable period in which the qualifying expenditure was incurred.

(3) The amount of the qualifying allowance to be given is determined by the formula—

B

A ×


C

where

A =

qualifying expenditure incurred on the quota.

B =

length of the part of the chargeable period falling within the writing down period.

C =

length of writing down period.

Relevant Date: Finance Act 2021