UHY Ross Brooke Chartered Accountants

Osborne surprises with increased tax allowance for business investment

In yesterday’s surprise announcement the Chancellor announced that the Annual Investment Allowance (AIA) for capital expenditure will be doubled from £250,000 to £500,000 from 1 April 2014, for companies or 6 April 2014 for unincorporated businesses until 31 December 2015. The AIA will return to £25,000 after this date.

This welcome news to businesses effectively means that over 99% of companies can now claim a 100% deduction for the cost of qualifying plant and machinery.

The AIA will return to £25,000 after 31 December 2015 and there are very complex rules that business need to be aware of, if their accounting period straddles the key dates of 1 January 2013 or 1 January 2016.  Past experience has shown that it is all too easy to make an investment thinking that the 100% relief is available only to discover that due to the timing of the purchase the relief is restricted.

Talk to us if you are considering making an investment in plant or machinery to ensure your assets qualify and to ensure that the timing is right.

It’s time limited; invest wisely.

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