Susan owns a house in Spain which she rents out to a tenant.
In 2018, she bought a washing machine for the house which cost €250. She claimed capital allowances at a rate of 12.5% of the cost of the washing machine against her rental income from the house for the years 2018, 2019 and 2020.
In 2021, she sold the washing machine for €100. As she sold the washing machine for less than its written down value, she is allowed a balancing allowance.
The written down value of the washing machine is what it cost Susan, less the capital allowances she claimed.
Susan's balancing allowance calculations for 2021
| Description|| Amount|
|Washing machine cost
|Less 2018 Capital allowance €250 @ 12.5%
|Less 2019 Capital allowance €250 @ 12.5%
|Less 2020 Capital allowance €250 @ 12.5%
|Written down value at end 2020
|Less proceeds of washing machine sold in 2021
|Balancing allowance for 2021