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Recommended approach to claims and record keeping (part 3)

Updated 20 May 2024

© Crown copyright 2024

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This publication is available at https://www.gov.uk/government/publications/help-to-avoid-errors-in-claims-for-plant-and-machinery-allowances-gfc5/recommended-approach-to-claims-and-record-keeping-part-3

Good record keeping is important. Keeping clear records enables you to ensure your claims are correct and will help HMRC resolve any questions in a shorter time. We recommend you keep a record of capital allowances you have claimed, either for the specific asset or as part of a pool.

Find out more information about rates and pools.

We recommend:

  • you keep records of all acquisitions and disposals, including:
    • the name of the asset(s)
    • date of acquisition
    • acquisition cost
    • date of disposal
    • disposal receipts or value on disposal
  • you record how you got your plant or machinery as this may affect the qualifying expenditure, for example, if it was:
    • bought
    • received as a gift
    • already in use for another purpose

If an asset is also used for purposes other than the qualifying activity, you should keep good enough records. You must be able to show how the use of the asset is split between the qualifying business activity and other purposes. For example, your vehicle records could keep track of business mileage. Your laptop records could track the amount of time it is used for the qualifying activity. This will help you to make a just and reasonable apportionment to find the claimable amount.

When you file your tax return, it is helpful to include full details of your capital allowance claims so HMRC can understand your tax return.

Items to list include:

  • writing down allowance pools, brought forwards in allowance pools and single asset pools
  • any new acquisitions
  • the acquisition values
  • the type of allowances claimed
  • disposals
  • the disposal values
  • any balancing allowances and charges
  • writing down allowance claims per pool in the chargeable period
  • writing down values carried forwards to the next period per allowance pool and single asset pools

It is helpful to include more information for large projects with significant expenditure.

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