Sarah Bradford points out that time is running short to benefit from the enhanced annual investment allowance.
The Covid-19 pandemic may have forced many businesses to delay capital projects. However, such a delay may prove costly from a tax perspective.
The annual investment allowance (AIA) allows a business a 100% deduction for capital expenditure in the accounting period in which it was incurred, up to the level of the unused AIA limit for that period. This allows relief for the expenditure to be received immediately, rather than being spread over a number of years where a writing down allowance was claimed instead.
Ups and downs
The AIA was temporarily increased from its permanent level of £200,000 a year to £1 million for the two-year period 1 January 2019 to 31 December 2021. This period is rapidly coming
