Balancing charge on general pool and FYA additions

Article ID

ias-11887

Article Name

Balancing charge on general pool and FYA additions

Created Date

21st April 2015

Product

IRIS Business Tax

Problem

Client has a balancing charge on the general pool as disposal proceeds are greater than the pool brought forward + non first year allowance (FYA) additions. There are also additions on which FYAs are being claimed and these are being shown in the pool carried forward field.

Resolution

Business Tax is carrying out the calculations correctly. Expenditure on assets on which FYAs have been claimed is not pooled immediately. Instead it is added to the pool brought forward at the start of the next chargeable period. Businesses may reduce the balancing charge by not claiming FYAs on part of the expenditure on additions.