Jeffrey Golding

I act as agent for my son who is a self employed gardener. His old van has a depreciated book value of £2250 which he has had to scrap as it is too old to be exempt from the £12.50 charge. He is buying a replacement van which will cost £17000. How is the £5000 scrappage allowance treated for tax purposes regarding the book value of the scrapped van and depreciation on the new van.This will increase the depreciation for the year ended 5 April 2023 from £563 to £6500 if 25% depreciation is applied which is bound to be queried by the Inland Revenue unless an explanation is given when filling in the self assessment return for the year.