CAPITAL ALLOWANCES  

Plant and Machinery – Annual Investment Allowance (AIA) 

The AIA allows for 100% write off on most types of plant and machinery costs and long life assets but does not cover cars.  Write off is allowed up to the value of £50,000 p.a.  Expenditure that is incurred on or after 6 April 2010 means that the limit will be increased to £100,000.

Any amounts that fall over the AIA limited will be taxed at the normal capital allowance limits either 10% or 20%.

Other plant and machinery 

The annual rate of allowance is 20%.

Expenditure that relates to integral features and long life assets incurs a rate of 10%.

Cars

Expenditure that is incurred on or after 6 April 2009 will generally be allocated to one of two pools.  Cars with a CO2 emission not exceeding 160gm/km will receive an allowance of 20% p.a. those with emissions over this will receive a 10% allowance p.a.

Industrial and agricultural buildings

The annual rate of allowance is 1% (2%) from 6 April 2010.