Nick Wright examines the restriction on capital allowances for residential property, the case law meaning of 'dwelling house', and the limited circumstances in which residential landlords can still secure relief.
Capital expenditure is not deductible against trading or rental profits, and accounting depreciation is similarly disallowed (ITTOIA 2005, s 33; CTA 2009, s 53).
Capital allowances exist as a separate statutory mechanism whereby qualifying expenditure on capital assets is given as a deemed deduction, spread over several years at prescribed rates.
