SolvedCA80800 | Dredging: How allowances are made
From HM Revenue & Customs · Capital Allowances Manual
Dredging allowances are made in calculating the profits of the trade. This means that for income tax a dredging allowance is treated as a business expense and is deducted from the trading profits to calculate the taxable profits. For corporation tax a dredging allowance is treated as a trading expense.