The cash basis scheme helps many sole traders and other unincorporated businesses benefit from a simpler way of managing their financial affairs. The scheme is not open to limited companies and limited liability partnerships. The scheme allows qualifying businesses to use the cash basis when recording income and expenditure. You must have a turnover of £150,000 or less to join the scheme and you can continue using the scheme until your turnover reaches £300,000. However, some small businesses are more suited to using the case basis than others. If you are using the cash basis scheme, then capital expenditure is usually treated as an allowable business expense with the following exceptions: The acquisition or disposal of a business or part of a business Education or training The provision, alteration or disposal of certain non-depreciating assets, assets not acquired or created for continuing use in the trade, land, non-qualifying intangible assets and certain financial assets. In addition, if you buy a car you can claim the purchase as a Capital Allowance (but only if you’re not using simplified expenses to work out your business expenses for that vehicle).