For over 30 years Richard Edwards Group LLP has been providing excellent advice and a first class service to our clients. We have a large portfolio of clients and service businesses across many sectors. Book one of our FREE INITIAL MEETINGS to start benefiting from our expertise today.

What expenditure qualifies for the Annual Investment Allowance?

Source: HM Revenue & Customs | | 18/12/2018

The Annual Investment Allowance (AIA) was permanently set at £200,000 for all qualifying expenditure on or after 1 January 2016. However, in the Budget earlier this year, the Chancellor announced a temporary increase in the allowance to £1 million for a 2-year period from 1 January 2019 to 31 December 2020.

The AIA allows for 100% first year tax relief for qualifying expenditure on plant and machinery. The AIA is available for most assets purchased by a business, such as machines and tools, vans, lorries, diggers, office equipment, building fixtures and computers.

The AIA does not apply to cars. Also, you cannot claim AIA on items you owned for another reason before you started using them in your business or on items given to you or your business, although writing down allowances may be available.

The AIA can be claimed by an individual, partnership or company carrying on a trade, profession or vocation, a UK non-residential property business or a Furnished Holiday Lettings (FHLs). Partnerships or trusts with individuals and companies in the business structure do not qualify for the AIA.

Businesses thinking of incurring large items of capital expenditure over the coming months, should ensure that any purchase is properly timed to take full advantage of the temporary increase in the AIA limit.



 

Latest News

HMRC publishes more strange excuses
22/01/2019 - More...
A recent press release by HMRC revealed some of the oddest excuses for submitting a late tax return. The excuses ranged from the sublime to the ridiculous and included: My

Avoid car-fuel benefit charge for 2018-19
22/01/2019 - More...
The easiest way to ensure that no car-fuel benefit charge (for private journeys in a company car) is payable, is to use the advisory fuel rates published by HMRC to repay any


Newsletter

With our newsletter, you automatically receive our latest news per e-mail and get access to the archive including advanced search options!

» Sign up for the Newsletter
» Login