Capital Allowances

Plant & Machinery – Annual Investment Allowances

The AIA allowance gives 100% relief on most types of plant & machinery brought in the year up to £500’000 PA for expenditure incurred on or after 6th April 2014. (1 April 2014 for companies). The rate may be reduced to £25,000 for expenditure incurred on or after 1st January 2016. Special rules apply to accounting periods straddling these dates. Any costs over the AIA fall into the normal capital allowance pools below. The AIA may need to be shared between businesses under common ownership.

Plant & Machinery Pools

The standard rate of allowances for pooled assets is 18%.

An 8% rate applies to expenditure incurred on integral features and on long life assets.

100% first year allowance may be available on certain energy efficient plant and cars, including expenditure incurred on new and unused zero emission goods vehicles.


For expenditure incurred on cars, cost are generally allocated to one of the two plant and machinery pools.

Capital allowances available on cars is now linked to the level of Co2 emissions the car emits. From 6 April 2013 (1 April 2013 for companies) Cars with Co2 emissions not exceeding 130gm/km (previously 160gm/km) receive an 18% allowance p.a. Cars with Co2 emissions over 130gm/km (previously 160gm/km) receive a 8% allowance pa.

If you have any questions or would like further information please call on 01527 68235