Capital Allowances
| 2021/2022 | 2022/2023 | 2023/2024 | |
|---|---|---|---|
| Main rate pool: writing down allowance | 18% | 18% | 18% |
| Special rate pool (long life assets, integral features): writing down allowance | 6% | 6% | 6% |
| Annual Investment Allowance (AIA) cap: | £1,000,000 | £1,000,000 | £200,000 |
| Structures and Buildings Allowance | 3% | 3% | 3% |
Expenditure within the AIA qualifies for 100% allowance in the year of purchase. The AIA cap is currently £1,000,000 from the 1st January 2019. On the 1st of April 2023 the AIA limit will be reduced to £200,000 again. If the accounting period is shorter or longer than 12-months the AIA cap is apportioned based on the length of the period.
The AIA allows businesses to invest in equipment and fixtures (cars and buildings don’t qualify), with 100% tax relief in the year of purchase.
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