Annual Investment Allowance (AIA) – Enhanced Relief Extended to January 2022!

Annual Investment Allowance (AIA) – Enhanced Relief Extended to January 2022!

In January 2019 the Annual Investment Allowance (“AIA”) was increased from £200k to £1 million for a period of two years ending in January 2021. The allowance, which provides 100% tax relief for investments in plant and machinery, was introduced to give companies the confidence to invest in order to promote business growth and boost the economy. Most assets purchased for business purposes qualify for the allowance including office equipment and furniture, machinery, certain fixtures and ‘integral features’ of a building, with cars being a notable exception.

There is good news for businesses planning to invest, as the increased AIA which was due to revert to £200k in January 2021 has been extended for another year to January 2022! The decision has been made by government to ‘boost confidence as companies look to weather the pandemic and plan for the future’. The AIA is available to all businesses including sole traders and partnerships, so if you are looking to make any additions to your business for over £200k, the tax benefits of doing so before January 2022 may encourage you to hurry plans along.

If you would like more information, please don't hesitate to contact our Tax Partners, Steve Crompton or Lucy Williams on the details below:


Steve Crompton

Partner – Head of Tax

direct dial: 01942 292541

mobile: 07790 840394



Lucy Williams

Tax Partner

direct dial: 01942 292543

mobile: 07807 053494