Many businesses, which include manufacturing firms, can claim up to £1 million in same-year tax relief via the AIA for any capital investments they make in plant and machinery, until the 1st January 2022.
"The AIA extension was supposed to revert to £200,000 on the 1st January 2021!"
This is a very positive move from the Treasury and is vital in supporting businesses through the difficult start most will face in 2021. The extension to the AIA cap will give businesses more confidence when considering investments in the next 12-months.
Seen by many as a yo-yo allowance, with increases and reductions happening regularly, each change is designed to accelerate investments into United Kingdom businesses.
I believe today's announcement will ensure more investments will qualify, and those delayed by the pandemic can still go ahead in the new year. It's going to be very useful for manufacturers where business confidence is returning thanks to the recent vaccine announcements.
"Have you been in survival mode in 2020?"
If your business has been in survival mode during the pandemic, be confident that any plant and machinery assets you want to invest in next year will be covered by the Annual Investment Allowance extension to the £1 million cap.
Until next time ...
ROGER EDDOWES Business Godparent
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about the Annual Investment Allowance, call me on 01908 774320, leave a comment below or click here to ping over an email and let's see how I can help you.
Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
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