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    Capital Allowances

  • Go to ...
  • annual investment allowance
  • plant & machinery
  • motor cars
  • other asset types
  • intangible assets
  •  


    Annual Investment Allowance (AIA)
      Sole Trader /
    Partnership
    Limited
    Company
    From the 1st January 2016 £200,000 £200,000
    6th April 2014 - 31st December 2015 £500,000 -
    1st April 2014 - 31st December 2015 - £500,000
    1st January 2013 - 5th April 2014 £250,000 -
    1st January 2013 - 31st March 2014 - £250,000
    6th April 2012 - 31st December 2012 £25,000 -
    1st April 2012 - 31st December 2012 - £25,000
    6th April 2010 - 5th April 2012 £100,000 -
    1st April 2010 - 31st March 2012 - £100,000
    6th April 2008 - 5th April 2010 £50,000 -
    1st April 2008 - 31st March 2010 - £50,000

    Notes

    1. You can deduct the full value of an item that qualifies for Annual Investment Allowance from your profits before tax (up to the maximum for the period listed above).
    2. You can claim AIA on most plant and machinery.
    3. You can't claim AIA on:
      • Cars
      • Items you owned for another reason before you started using them in your business
      • Items given to you for your business.
      For these items claim writing-down allowance as appropriate instead.
    4. If your accounting period straddles two AIA rates you use a proportion of both rates to calculate the maximum amount of AIA you can claim.
      For example, your year end is 31.03.16, the amount of AIA is calculated as follows:
      • 3/12 x £200,000 =   £50,000
      • 9/12 x £500,000 = £375,000
      • Total AIA           = £425,000
    5. Assets purchased that allows you to claim first year allowance (first year allowance is the full cost of the asset) are over-and-above your AIA.
    6. Once you have utilised all of your AIA, additional assets go into either the Main Pool or Special Rate Pool / Single Asset Pool (mainly cars with CO2 greater than 130gm/km) and you can claim Reducing Balance writing-down allowances of 18% on the Main Pool and 8% on the Special Pool.

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    Plant and Machinery
      2016-17 2015-16
    Main writing down allowance rate 18% 18%
    Special rate pool
    (long life assets and integral features within a building)
    8% 8%
    Enterprise Zone plant & machinery
    (max €125m per investment project)
    100% 100%
    Patent rights & know-how (annual reducing balance) 25% 25%
    Energy and water-efficient equipment 100% 100%
    Electric vans 100% 100%
    Energy saving / environmentally beneficial assets 100% 100%

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    Motor Cars
      2016-17 2015-16
    New or used cars with CO2 emissions of 75gm/km or less (non-electric) 100% -
    New or used cars with CO2 emissions between 75gm/km and 130gm/km 18% -
    Second hand cars with CO2 emissions of 130gm/km or less or car is electric 18% -
    Low emission less than or equal to 75gm/km - 100%
    Emissions between 76gm/km and 130gm/km - 18%
    Emissions greater than 130gm/km 8% 8%

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    Other Asset Types
      2016-17 2015-16
    Commercial or Industrial Buildings in an Enterprise Zone 100% 100%
    Research and Development 100% 100%
    Business premises Renovation Allowance 100% 100%

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    Intangible Assets

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