EIM32861 - Other expenses: interest paid: example
A university lecturer acquires a computer on 6 April 2023 for research purposes. The requirements of EIM70790 are met and they are entitled to capital allowances. The computer cost £6,000 and was financed by a loan on which they paid interest of £600 in 2023 to 2024. 25% of their use of the computer is for private purposes. They are entitled to capital allowances to the extent of the business use, see EIM36570. They claim AIA of £6000 x 75% = £4,500.
Relief is available to the same extent for interest paid.
£600 × 75% = £450
Relief for £450 is available against general income.