What can be included in Capital Allowance calculations?

[missey1977]

Thanks for everyone's previous help and answers. Final calculations i'm trying to do are for Capital Allowances

My situation is that i bought my appartment in 2005, it was fully furnished (kitchen goods, sofas, tables etc...) with furnishings and carpets just left there by the previous owner. (Or you could say included in my purchase price). I have only bought a bed and a couple of cupboards, lamps.

My questions are

1. Can i include all these furnishings and carpets (the ones i bought AND the ones left by the previous owner) in my calculation for Capital Allowance? Bearing in mind that most of these things are probably >7 years old now

2. On the form (Form 12) itself when asked for the "Capital/Balancing Allowances for the year 2008". What value do i put here? Is it the total value i've calculated, or is it 12.5% of this value?

3. What's the story with carrying Capital Allowance forward? Why would i do that?

Thanks again.

 

[Graham_07]

1. If the originals are > 7 year old then you're looking at negligable values anyways.
What you bought, less estimated reduction for your usage could be claimed.

2. If the value of furnishings is €8,000 then 12.5% = €1,000 for the year. That's what goes in.

3. If you have no or insufficient rental income to absorb the C/Allces then the balance can be c/fwd to next year. e.g.
Net Rental Income 2,000
C/Allces 3,000
Taxable income 0
C/F C/Allces 1,000

 

[missey1977]

Thanks, that's perfect.
Just to check, so if my net rental income was 2,000 and my capital allowances was 3,000 i would fill form in as:

Net rental income 2,000

Capital Allowances forward from prior year 0
Capital/Balancing Allowances for the year 2008 3,000 (or should it be 2,000)
Capital Allowances available for carry forward or offset 1,000

 

[Graham_07]

Thanks, that's perfect.
Just to check, so if my net rental income was 2,000 and my capital allowances was 3,000 i would fill form in as:

Net rental income 2,000

Capital Allowances forward from prior year 0
Capital/Balancing Allowances for the year 2008 3,000
Capital Allowances available for carry forward or offset 1,000

Yes.

Remember next year you then have 1,000 b/fwd from 2008 into 2009 to start off. That is added to the 2009 C/Allces and only if net rents exceed that will there be a liability.

 

[DB74]

Capital Allowances forward from prior year 0
Capital/Balancing Allowances for the year 2008 3,000 (or should it be 2,000)
Capital Allowances available for carry forward or offset 1,000

It's very unlikely that your unused Capital Allowances are available for offset unless it is a very specific type of building.

It is more likely that the Capital Allowances can only be carried forward.

 

[missey1977]

That's just what it says on the form (it lumps carry forward and offset together). I doubt i have any to carry forward anyway, but am getting all the tax know-how i can so it'll be easier next time!