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

0114 266 7141

Related content

Tax Rates and Allowances 2022/23

Introduction We have summarised the key rates and allowances which are fundamental to our business and personal lives. We are sure that you will find them a useful point of reference and have set out below a few examples of how they can be used. Personal tax rates As...