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Annual Investment Allowance changes

Ref: 193

Date: Mon 27/Jan/2014, 08:51

From January 1st 2013, an increased threshold for Annual Investment Allowances has been in place. This means 100% allowance is available on up to 250,000 per annum of capital expenditure incurred against taxable profits. It can be claimed by most business that pay corporation or income tax. This increased allowance lasts until January 1st 2015 so there's still time for you to take advantage of the tax savings on qualifying expenditure.

Conditions do apply and can be found in the guidance from HMRC. Here are some key points.

  • The expense or inception of the purchase agreement must be incurred inside of the two year period and the asset must be in use before the 1st January 2015 and have a usable life of two years or more.
  • The Allowance is only available for the first 250,000 of expenditure in each tax year.
  • Qualifying expenditure includes most assets purchased by a business. eg;
    - Office furniture and equipment
    - Vans, lorries and equipment
    - Business machines e.g. printing press, lathes, tooling machines
    - Tractors, combine harvesters and other agricultural machinery

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