Capital Allowance Changes to Hit Shipping

Moore Stephens has warned that forthcoming changes to capital allowance regulations in the UK could have a significant impact on the shipping sector. The changes will affect, firstly, UK-resident shipowners not registered for Tonnage Tax. Reportedly, as of April 2008, capital allowances on ships and other plant and machinery will be reduced from 25 per cent to 20 per cent. At the same time, capital allowances on long-life assets will be increased from six to ten per cent. Meanwhile, owners of property in the maritime sector - for example cargo warehouses and other buildings used for storage in the through-transport sector - will be among those who could be affected by a surprise decision to phase out UK Industrial Buildings Allowances (IBAs) by 2011.