Satwaki Chanda looks at the new capital allowances available for plant and machinery and their impact on property companies.
The following measures affecting plant and machinery allowances are due to be enacted in this year’s Finance Act (which is awaiting Royal Assent at the time of writing):
- The annual investment allowance (AIA) is maintained at £1 million until 31 December 2021.
- From 1 April 2021 to 31 March 2023, a first-year allowance of 130% is available to companies for main rate expenditure and a 50% allowance for special rate expenditure.
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Until 30 September 2026, first-year allowances of 100% are available to companies for expenditure incurred in a freeport tax site.
Since the reliefs are only available for capital expenditure, they are more
