Asset finance specialist Academy Leasing is reminding printers to invest before the end of 2015 of maximise Annual Investment Allowance (AIA) tax savings. From 1 January 2016 the AIA will fall from the current rate of £500,000 to £200,000, reducing the tax relief cap on investments in equipment and development capital.
The AIA offers tax relief at 100% on qualifying expenditure in the year of purchase, deductible from taxable profits.
For businesses that have accounting periods that straddle 1 January 2016, the AIA will combine both the existing and new limits. A company with a 31 March year-end, for example, will have an allowance of £425,000 (£500,000 x 9/12ths + £200,000 x 3/12ths).
From January 1, 2016 to year-end however, the AIA will only extend to the calculated allowance for this period.