Where a person enters the cash basis for a tax year, any expenditure that is unrelieved qualifying expenditure for capital allowances purposes and would qualify as a deduction within the cash basis is allowable as a deduction in calculating the profits of the trade under the cash basis unless the assets are not fully paid for.

Where assets (other than cars) are not fully paid for and the amount paid exceeds the capital allowances given the difference is deductible for the purposes of calculating profit under the cash basis. Where the amount paid is less than the capital allowances given the difference is a receipt.

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