Historically, the AIA, as many will know, has been quite low in comparison to the £1m limit bought into place on 1st January 2019. This increase, has for many, allowed for rapid growth due to it cancelling out the need for the WDA’s and allowing a much quicker cash tax return on capital investment.
The ATT had called for Chancellor Rishi Sunak to extend the AIA in the Autumn budget, which given the current climate would give businesses some much needed breathing space into 2021. With the news that the Autumn budget had been cancelled, this seemed highly unlikely to happen.
STAX warmly welcomes the announcement that the temporary increase in the AIA will be extended for a further year to 31 December 2021, for businesses with higher levels of qualifying capital expenditure this offers not only breathing space but also a chance for growth into 2021.
But what can you claim on?
Claims can come from the acquisition of loose plant and machinery, a proportion of the purchase expenditure of a property, fixtures installed when improving your property (e.g. electrics, fire alarms, air conditioning, sanitaryware, etc.), as well as items that are associated with the core operations of your business. For example, Hotel & Furnished Holiday Let owners investing money in decorative items to make their property more appealing.
There are a wide range of items that qualify for Capital Allowances, however, identifying those items can sometimes be less that straight forward. Because of this, it is prudent to speak with a specialist Capital Allowance adviser with a fusion of tax and surveying expertise. Not only should this ensure you maximise your relief, but will also ensure a compliant claim in line with HMRC’s guidelines.
What to do next?
With filing deadlines hot on its heels, it has never been so important to get your Capital Allowance ducks in a row. For those savvy few getting their tax affairs in order now, it could make all the difference to a cash flow positive 2021.
At this time of year, we have several key dates approaching. 31st January for filings and many corporates with yea- ends in line with the calendar. Up until the passing of these dates, taxpayers with historic qualifying expenditure could potentially benefit from a starting position of two tax rebates from day one. A welcome injection of cash for many in these difficult times.
It takes less than 5 minutes to discover what Capital Allowances you and your clients could be entitled to claim, don’t miss out!
Stanley Tax Associates (S-Tax) have been advising commercial property owners for 10 years, assisting them in accessing their due Capital Allowances and ensuring compliance with an ever-changing legislative landscape.