Question 1

Section A

'Sky-High Farms Ltd' constructed a new vertical farming facility. The total cost was £2,000,000, which included £500,000 for the land. The facility was brought into use on 1 July 2023.

What is the Structures and Buildings Allowance (SBA) that can be claimed for the year ended 31 March 2024?

Accepted Answer

Deduct the non-qualifying land cost from the total cost. Apply the 3% SBA rate, and pro-rate the allowance from the date the building was brought into use to the end of the accounting period.

Question 2

What mistakes do candidates make on this ACCA question?

Accepted Answer

Including the cost of land or forgetting to time-apportion the allowance.

How to approach this question

Full Answer

Common mistakes

Practice the full ACCA TX — Taxation Practice Exam 3

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