The Annual Investment Allowance (AIA) was temporarily increased from £25,000 to £250,000 in January 2013 and was due to end in December 2014. The chancellor announced in the 2014 budget that this was extended for a further year to 31st December 2015.
From 1st April 2014 the AIA doubled to £500,000, meaning businesses will receive a 100% capital allowance relief on investment in plant and machinery.
These reliefs are designed to stimulate growth in the economy but unfortunately the AIA will revert back to £25,000 on 1st January ’16.
TIP: If you intend to purchase equipment in your next financial year, do it no later than 31st December 2015. That way more of the cost will qualify for tax relief all at once. But be careful if you're using a hire or lease purchase contract as the date of the purchase for tax purposes is when you start using the equipment.
For more information on this topic, please contact Dawn.
Dawn Clarkson Associates
Phone: 01969 624999
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