Jonah started trading on 1st February 2019 and made his first accounts up to 30th April 2020 (15 months). Profit before deduction of capital allowances was £45,000 for the period. Additions and disposals during the period for capital allowances purposes were:”

“Additions                                                                      £

Office equipment and furniture                                 5,000

New car 1 with CO2 emissions of 44 g/km             14,000

New car 2 with CO2 emissions of 76 g/km             15,000

New car 3 with CO2 emissions of 121 g/km           24,000

New car 4 with CO2 emissions of 123 g/km           28,000”

“Cars 3 and 4 were used 30% privately by Jonah, cars 1 and 2 are used by employees.”

“Disposals                                                                      £

New car 3 with CO2 emissions of 121 g/km           25,000”

“Calculate the following:

a. The maximum capital allowance claims for the 15 months ended 30 April 2020. 

b. “Profit assessments for Jonah for the tax years 2018/19 to 2020/21 and the overlap profits carried forward. 

c. “Explain and illustrate how the historic profits of a trade are assessed in full only once during the life of business under the current year basis of assessment rules. Are there any disadvantages to these rules of assessment?