Bookkeeper serving Yeovil, Sherborne, Langport, Wincanton, Somerton and surrounding areas of South Somerset and West Dorset.

Summary of Capital Allowances available from 1st January 2016

The following capital expenditure may be deducted from income in calculating taxable profits:

Note: where cars are used partly for business and partly for personal use, you may only claim capital allowances on a fraction of the cost of the car corresponding to the proportion of mileage which is for business.

The maximum Annual Investment Allowance has changed since the last calendar year. A hybrid maximum allowance will apply for accounting years which span the two calendar years (which includes accounting year corresponding to the 2015/16 tax year). 

The above Annual Investment Allowance (AIA) applies to companies and sole traders whose accounting year chargeable to tax ends on or after 1 January 2016 . In 2015 the AIA was higher at £500,000. Where accounting years span the calendar years 2015 and 2016 a hybrid AIA will apply. The hybrid maximum allowance is calculated by working out the proportion of the accounting year falling within the earlier calendar year, and the remaining proportion falling in the later calendar year, then working out the weighted average of the two maximum annual investment allowances: £500,000 for 2015 and £200,000 for 2016. This means that during the 2015/16 tax year two allowances apply: from 6th April to 31st December 2015 the AIA was £500,000, while from 1st January to 5th April 2016 the AIA is £200,000.

Rates for Previous Years

Capital Allowances 2014/15   Capital Allowances 2013/14   Capital Allowances 2012/13
Capital Allowances 2011/12

For help with self-assessment tax contact Four Elms Bookkeeping.

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