The Chancellor announced in the Autumn Budget an extension of the temporary increase in the Annual Investment Allowance (AIA) to 31 March 2023.
Most corporate and unincorporated businesses are able to utilise the AIA to claim 100% tax relief on their qualifying expenditure on plant and machinery.
The allowance was temporarily increased from £200,000 to £1 million for expenditure incurred on or after 1 January 2019 and was due to revert back to £200,000 from 1 January 2022. The Chancellor has announced that the £1 million allowance will now be retained until 31 March 2023.
Transitional rules will apply to accounting periods that span 1 April 2023.
For companies, this aligns the end of the temporary AIA with the end of the ‘super-deductions’ as announced by the government in Spring Budget 2021.
More from our tax experts
You can find all of our latest tax articles and tax resources here.
If you are looking for advice in a particular area, please get in touch with your usual Hawsons contact.
Alternatively, we offer all new clients a free initial meeting to have a discussion about their own personal circumstances – find out more or book your free initial meeting here. We have offices in Sheffield, Doncaster and Northampton.
Free initial meeting
Craig Walker
Tax Director, Sheffield
Related content
Creative Tax Reliefs – permanent higher rates of tax reliefs
In the Spring Budget, the Chancellor announced that a permanent extension will be made to tax relief for theatres, orchestras, museums and galleries. The government is also providing £26 million of funding to upgrade the National Theatre’s stages and infrastructure....
Advisory fuel rates for company cars
HMRC has published new advisory fuel rates for company car users which take effect from 1 June 2024. The rates have increased by 1p per mile for most petrol and diesel cars. Petrol cars with an engine size over 2000c have seen a larger increase of 2p per mile. The LPG...
Inheritance tax planning guide
Inheritance tax planning How can I reduce any inheritance tax liabilities? Planning ahead allows individuals and couples to employ strategies for reducing the value of their taxable estate, helping them stay under the inheritance tax threshold. Annual gift allowance...