Should you ever defer Capital Allowance for a Ltd Company?

scoobie

I have a Ltd Company, currently making a loss. Because of that I won't have to pay any corporation tax this year.

Is it sensible therefore for me to claim full Annual investment allowance (AIA) on capital items purchased in this company tax year (Computer equipment) or should I write them down over a number of years using the Working Down Allowance at 18% per year?

Or does it make no difference if I write it all off this year using AIA because any losses can be carried forward from year to year going forward?

Thanks for your help.

Pennywise

Depends on what your forecasts show. Will it have a taxable profit next year (with or without the capital allowances you may wish to carry forward), or will it be 2, 3 or 4 years away? Is the asset a pooled asset or is it in a separate asset pool - that's important if your plans include selling the asset in the foreseeable future. Will you keep to the same trade in the future, or will the company change direction? (Losses can only be set against the same trade, so if you create a loss to carry forward and then change the company's trade, you won't be able to use historic losses brought forward). It's simply all down to your future plans.