Capital Allowance Rates 2008/9 ??

signman_2

|Could someone tell me rates for new machinery bought this year, I see the rates have changed but unclear what the percentages are now..

Tnx

nakmeister

Capital allowances on plant & machinery have been reduced from 25% to 20%. There's a new integral features rate of 10% on fixtures etc such as lighting, heating and water systems. First year allowances have been abolished - instead there's a new 'annual investment allowance' (AIA) of £50,000 - the first 50k of qualifying assets get 100% relief. This 50k is apportioned for short accounting periods and accounting periods straddling the 1/6 April 2008. Only one AIA per group of companies. Oh and you can still get 100% allowances on certain energy/water saving equipment/machinery.

colhun

You get an annual investment allowance (AIA) of £50,000 for tax year 08/09. If your tax year straddles two tax years the AIA is apportioned pro rata.

Any expenditure on plant & equip up to the AIA will qualify for 100% tax relief (cars do not qualify).

The rate of writing down allowance is now 20% (previously 25%).

signman_2

Thanks all, seems better now at 100% up to 50k.
Does his means previous years items are now within this "pool" so out of the 20% yearly writedown?

Ie all written off for yearly reductions?

Elaine_Wilson

Previous year's items are within the pool and the brought forward figure will be subject to the 20% deduction. But if the balance on the pool is less than £1,000 then the whole balance can be written off in one go.

The actual calculation is to add any items purchased which do not qualify for the AIA and deduct the sale proceeds of any old items sold in the year. Then if this balance is below £1,000 then the claim can be made.

nakmeister

Expenditure from previous years will get put into the new 20% pool and you'll get 20% allowances on the residue of qualifying expenditure (unless your accounting period straddles 6 April in which case for that period you'll get an apportioned rate somewhere between 20% and 25%)