Different types of capital allowances

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Annual Investment Allowance (AIA)
One of the most valuable capital allowances for FHL owners is the Annual Investment Allowance (AIA). As of the current tax year, the AIA limit is £1 million. This means that you can claim a 100% tax deduction on qualifying expenditures, up to £1 million, for the year.
If the total cost of your embedded fixtures falls below the AIA limit, you can deduct the entire amount from your taxable profits in the year the expense was incurred. This immediate tax relief can help reduce your overall tax liability and boost your cash flow.
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Writing Down Allowance (WDA)
If the cost of your embedded fixtures exceeds the AIA limit, you can still claim tax relief through the Writing Down Allowance (WDA). The WDA allows you to claim a tax deduction on the remaining balance of qualifying expenditures at a rate of 18% per year for general pool and 6% for special rate pool.
Take a look at some of our FHL case studies...
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Capital Allowances Manual
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Autumn Budget 2023: Changes to Capital Allowances
The Autumn Budget of 2023 has arrived, and with it comes significant changes and developments the government has put in place. Chancellor Jeremy Hunt delivered the statement on Wednesday, 22 November 2023. For businesses and individuals alike, these adjustments in tax policies can have far-reaching implications.
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