AIA was introduced as part of the Finance Act 2008 to encourage investment in plant and machinery, and subsequently stimulate economic growth.

The level of expenditure that can be claimed as part of AIA is not fixed, and has changed a number of times. It has been as low as £25,000, but as of January 2019 it’s set to £1,000,000. This is set to be reviewed again after 31st December 2020.

Who can Qualify?

It assists sole traders, partnerships and corporations alike, as long as all members are individuals. AIA encompasses most equipment that’s bought for business purposes.

The primary categories
for AIA include:

  • Office equipment and furniture.
  • Computer hardware and software.
  • Removal lorries, vans or diggers.
  • Building fixtures like air conditioning.
  • Business (or agricultural) machinery or tools.
  • Entertainment machinery (like arcade game machines).
  • Dual-control adapted cars used by driving schools.

AIA does not cover:

  • Building, land or structural work.
  • Cars (part of the cost of a corporate car can be reclaimed via other means).
  • Expenditure that’s solely for business entertainment.

Only those businesses that seek to claim AIA during the same year as an expenditure was made can make use of AIA, although some retrospective – and restricted – claims are considered in cases where the accounting periods are still open to amendment.

Certain retrospective or particularly high expenses cannot be claimed for using AIA. In those cases, tax relief for capital allowances is an option, allowing a business to use a Writing Down Allowance (WDA) to claim back some of the expenditure on a yearly basis.

Percentage rates vary from 6% to 18%, depending on whether the expense in question is classed as General or Special Rate/Integral Features Expenditure.

Visit the GOV.UK website for more detailed information.

Talk to the professionals

The Key Benefits
of AIA?

A major benefit of AIA is the speed that it lets you access tax relief. Rather than taking a period of a few years, expenditure can be claimed within just one year following a purchase. This acceleration of tax relief greatly benefits a business’s cash flow.

AIA has the additional advantage of simplifying business tax, as expenditure that’s less than the current AIA threshold can simply be left out of financial calculations.

Why Use Cost Care For Your
AIA Claim?

Cost Care have managed thousands of successful Annual Investment Allowance claims. Our years of experience mean that any AIA entitlement you have will always be maximised.

  • date

    Since 1995, we’ve claimed back millions of pounds in business tax relief.

  • stars

    Specialist claims management from start to finish.

  • clipboard

    We’re always up to date with the latest guidelines.

  • live-chat

    Constantly accessible, dedicated account managers.

  • speech-bubble

    Open and honest communication.

  • money

    Competitive rates (fees are contingent with a successful outcome).

Get in touch

If you’d like to discuss an Annual Investment Allowance claim with one of our experts,
then contact our specialist team at team@costcare.co.uk or call 0330 128 0044.

Cost Care is here to support accountants and your clients - call our team of experts today and refer your client …

Stay in touch

Sign up to our newsletter for industry insights and events.
  • This field is for validation purposes and should be left unchanged.