Annual Investment Allowance (AIA) allows businesses to deduct the full value of qualifying assets from profits before tax. The full tax relief is received in the year assets are purchased rather than over several years, therefore assisting cash flow.
A temporary increase will be applied to the AIA limit between 1 January 2019 and 31 December 2020
During this time the allowance will increase from £200,000 to £1,000,000 per financial year
This measure will provide significantly faster tax relief for qualifying investments up to £1 million, helping businesses to invest and grow.
The increase in AIA will apply to qualifying expenditure on equipment, machinery and other assets a business needs from 1 January 2019 until 31 December 2020 (dependent on a business’s chargeable period).
For more information on this allowance from HM Revenue & Customs, refer to their website: www.gov.uk
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