CTM76090 - Local currency accounting (FA00 scheme): capital allowances

1. Where an asset is used for the purposes of a business whose profits and losses are to be computed in a currency other than sterling, capital allowances are also to be calculated in that currency.
   
   
2. Where the Capital Allowances Act refers to a specific monetary amount in sterling, the equivalent amount in the relevant foreign currency is to be used (FA93/S93 (5)), (see CTM76070 for the exchange rate to be used).
   
   
3. Any balance of qualifying expenditure brought forward from the accounting period immediately preceding the first to which the revised rules apply shall be translated to the local currency by reference to the London closing exchange rate for the last day of that period.
   
   
4. If a company is running more than one local currency set of books, each treated as a separate branch, capital allowances on assets specifically identified with a particular set of books are translated in the currency used in that set. If the assets are not identifiable with any set of books, then they are likely to be dealt with in sterling after the books have all been translated for the purposes of the CT computation.