Annual Investment Allowance

Keeping up with the newest technology and trends is essential for British business owners. For this reason, it is vital to take advantage of all potential tax savings. The Annual Investment Allowance is one of these advantages (AIA). Businesses may deduct the entire amount of eligible capital expenditure up to a specified maximum from their taxable earnings in a particular tax year under this allowance. For the objective of spurring economic development, the Annual Investment Allowance was launched in 2008 as an incentive for companies to invest in equipment and machinery. The fact that the full cost may be deducted in the year of purchase rather than being spread out over a number of years is one of the most significant benefits offered by the allowance. This allows for tax relief to be obtained more quickly, which is one of the essential incentives provided by the HMRC.

How do I know an accountant is qualified?

Professional accounting bodies license accountants in the UK and elsewhere. These organizations provide both academic and practical training in accounting. Hire someone who has completed all the required examinations and has an accounting licence, whether for personal or business affairs.

Professional indemnity insurance (PII) is a contractual need for qualified accountants, and it protects both the accountant and the customers. If the accountant doesn’t follow your business interests or professional ethics, you may report them to their regulatory body. These are the top accounting institutions and their accompanying credentials in the UK.

ACCA – Chartered Certified Accountant (ACCA or FCCA)
Chartered Accountant (ICAEW) – (ACA or FCA)
Chartered Management Accountant (CMA) (ACMA or FCMA)
Chartered Accountants Ireland (CAI) (ACA or FCA)
Institute of Financial Accountants (AFA, FFA)

What services accountancy firm provide in the UK?

Although some accountancy firms will offer you a ‘one-size-fits-all’ solution, most services are more flexible than this. Accountancy packages can vary in the services they provide. Although there are certain basic functions which most accountants will provide (and which are generally included in a monthly fee), there may also be additional services available for an extra fee. These extras usually include Self Assessment Tax Returns, Payroll and workplace pension compliance, Limited Company Accounts, Tax advice/planning, VAT Returns and MTD.

Since its introduction, the amounts of spending which may be claimed under the Annual Investment Allowance have undergone a variety of revisions. The overall spending amount was raised to £100,000 in 2010 from £50,000 in 2008. From April to December of 2012, it was cut to £25,000, following which it was successively raised again in January 2013 to a level of £250,000. From April 2014, a temporary measure was imposed that quadrupled the existing amount to £500,000 until December 2015. The idea was to bring the price back down to where it was before, which was about £25,000 at the time. However, in July 2015, the U.K. government stated that the AIA would be set at a level of £200,000 and in January 2019, it was set temporarily to £1,000,000 for the following two years.