OT26212 - Capital Allowances: Mineral Extraction Allowance

Sale Proceeds

The sale proceeds to be brought into account are the disposal receipts or value, (CAA2001/s420). In arriving at a balancing allowance, the written down value of the asset is compared with the disposal value. Where this value exceeds the written down value, then a balancing charge arises, restricted to the allowances previously given. In demolition or abandonment situations, the net cost of the demolition of an asset representing qualifying expenditure is added to other qualifying expenditure in determining the balancing adjustment for the chargeable period related to the demolition (CAA2001/s433).