Are you making the most of capital allowances?
‘Capital allowances’ is the term used to describe the deduction we are able to claim on your behalf for expenditure on business equipment, in lieu of depreciation.
All businesses are able to claim a 100% annual investment allowance on the first £50,000 of expenditure on plant and machinery (except cars). In addition, there are specific 100% allowances available for some investments, including energy-saving equipment and low-emissions vehicles. Plant and machinery not qualifying for 100% allowances is generally subject to an annual writing down allowance of 20% on the reducing balance (restricted to £3,000 per car), although there is a reduced rate of 10% for certain categories.
If you make a purchase just before the end of the current accounting year, the allowances will usually be available a year earlier than if the purchase is made just after the year end.
In the same way, the disposal of an asset may trigger an earlier claim for relief or even an additional charge to tax.
Contact us for more help about the allowances available to you.