The Annual Investment Allowance (AIA) is the amount of investment in plant and machinery that qualifies for 100% tax relief. The allowance total was due to be reduced from the current temporary level of £500,000 to just £25,000 from 1 January 2016.
However, the Chancellor of the Exchequer has bowed to pressure from business leaders to stop tinkering with this allowance and set it at a permanent level so that businesses can plan their capital expenditure and investment properly. He has therefore revised his initial total to £200,000 for the new limit. This means that if you are considering spending significant sums on new plant or machinery for your business, we would recommend considering making this expenditure before 1 January 2016 so that you can benefit from the current higher allowance.
Our experts are here to offer support and advice when you are considering a purchase for your business, be it large or small. Contact us today on 01228 711888 to find out more.