The £1 million Annual Investment Allowance has now been made permanent.
An overview
You can claim capital allowances when you buy assets that you keep to use in your business, for example:
- equipment
- machinery
- business vehicles, for example vans, lorries or cars
Annual investment allowance
You can deduct the full value of an item that qualifies for annual investment allowance (AIA) from your profits before tax.
If you sell the item after claiming AIA you may need to pay tax.
What you can claim on
You can claim AIA on most plant and machinery up to the AIA amount.
What you cannot claim on
You cannot claim AIA on:
- business cars
- items you owned for another reason before you started using them in your business
- items given to you or your business
Claim writing down allowances instead.
The changes to the £1 million Annual Investment Allowance
Businesses investing in plant and machinery will welcome the decision to make the £1 million Annual Investment Allowance permanent. This has been extended several times and was scheduled to revert to just £200,000 from April 2023. Unlike the super-deduction, the Annual Investment Allowance is available to unincorporated businesses as well as limited companies and the equipment does not have to be new.
Need more information?
Do you need further guidance on the £1 million Annual Investment Allowance? We offer a wide range of services which are unique to your business. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.
Our fantastic team at A&C Chartered Accountants are here to help.
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