Opening years and AIA

by **Kitty Kat** on Mon Jun 13, 2011 2:51 pm

A client has a April 2011 year end. All their AIA expenditure (well below the limit, so splitting the AIA is irrelevant) falls pre April 2011.

Do I get the taxable profits (less AIA) to April and pro-rata, or do I take pre-AIA taxable profits, pro-rata them THEN deduct the AIA as all relating to 10/11?

I have Googled and found a million guides to splitting the AIA between years, but no mention of what to do after that.

by **collich** on Tue Jun 14, 2011 10:31 am

The AIA is a capital allowance and is giving for the chargeable period. The full amount of capital allowances (after the AIA) are deducted from the trading profit in the year ended 30 April 2011. It is this profit that is split by 11/12ths for the opening year rules.

by **Kitty Kat** on Tue Jun 14, 2011 10:36 am

collich wrote:The AIA is a capital allowance and is giving for the chargeable period. The full amount of capital allowances (after the AIA) are deducted from the trading profit in the year ended 30 April 2011. It is this profit that is split by 11/12ths for the opening year rules.

Thanks, I suspected as much, but I haven't done an opening year calc since the AIA came in so wanted to check