There is much to comment on following George Osborne’s Budget announcements last week. He surprised many with a welcome increase in the Annual Investment Allowance (AIA). From April 2014 to 31 December 2015 the AIA is increased from £250,000 to £500,000.
The AIA provides 100% tax relief on most capital expenditure on plant, machinery and equipment, with the exception of cars. The £250,000 limit was scheduled to be cut to £25,000 at the end of the year, and although there were calls to extend it, the increase to £500,000 was unexpected.
The rate of corporation tax for all companies will be 20% from 1 April 2015. For 2014/15 it is 20% for small companies and 21% for larger companies, as previously announced.
With other changes centred around savings, pensions, personal allowance and R&D Tax Credits this has been seen by most asa very positive budget, though not one without risks.
If you’d like more details, we have put together a PDF with a detailed analysis of Thursday’s budget announcements which you can access here.
We hope you find our budget coverage useful!