The present invention provides a system comprising an allophanate composition comprising a neutralized polyol, a polyuretdione resin, a tertiary amine catalyst, an additive package, and a reducer and a neutralized basecoat comprising an acid scavenger and a pigment. The resulting allophanate system may be used to make coatings, adhesives, castings, composites, and sealants in which clear-coating on neutralized pigmented basecoats is much improved in comparison to non-neutralized basecoats.