The Annual Investment Allowance (AIA) is a generous tax relief that was first introduced in 2008. The AIA allows for the total amount of qualifying expenditure on plant and machinery to be deducted from profits before tax.<\/p>\n
The AIA can be claimed by an individual, partnership or company carrying on a trade, profession or vocation, a UK non-residential property business or a furnished holiday let. Only partnerships or trusts with a mixture of individuals and companies in the business structure are unable to qualify for AIA.<\/p>\n
The AIA was permanently set at £200,000 for all qualifying expenditure on or after 1 January 2016. Following the pandemic, this limit has been temporarily increased to £1 million until 31 March 2023.<\/p>\n
The AIA is available for most assets purchased by a business, such as machines and tools, vans, lorries, diggers, office equipment, building fixtures and computers. The AIA does not apply to cars.<\/p>\n
A claim for AIA must be made in the period the item was bought. This date is defined as the date when a contract was signed – if payment is due within 4 months of the contract being signed – or the actual payment date if it’s due more than 4 months later.<\/p>\n
Companies also have the option to claim the super-deduction for purchases of qualifying equipment up to 31 March 2023. As this relief effectively provides a 130% deduction, this would be a better choice under most circumstances. Unfortunately, this super-deduction is only available to companies. The best choice for the self-employed is the AIA.<\/p>\n
The Annual Investment Allowance (AIA) is a<\/p>\n","protected":false},"author":1,"featured_media":5717,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[133,1],"tags":[],"acf":[],"yoast_head":"\n