Could a cyber attack bring down the energy grid?
On Friday October 21st, people tried to log on to Twitter. The site was down. Cyber hackers had crashed the wo...Read More
Introduced in 2008, the AIA allows all businesses – from start-ups to FTSE100s – to claim tax relief on capital investments. But the AIA limit has already changed four times.
At present, businesses are entitled to an Annual Investment Allowance of £500,000 until 31 December 2015. The new limit after this date has not yet been confirmed.
The allowance is currently at an all-time high due to a government programme to try and kick-start the economy by incentivising businesses to invest in plant purchases, including machinery, tools, fixtures and equipment.
But the looming election and unconfirmed 2016 limit means that it’s anyone’s guess as to what will happen with the AIA going forwards, says new business manager at Northgate Vehicle Hire Mark Batey. “Will we see the limit plummet below its original planned limit to just £25,000? Or will government take the advice of the Institute of Directors, which suggests the limit should be increased to £1 million?”
The British Chamber of Commerce (BCC) has suggested that a permanent AIA of £500,000 would help businesses to achieve balanced growth and tackle uncertainty. Batey welcomes this approach but warns that serious planning will be needed.
Whatever the final decision, you should balance the desire to take advantage of the current £500,000 limit against the risks of rushing in. As Batey points out: “While responsible investing should never be discouraged, rushing to invest in expensive assets that may only depreciate over time is undoubtedly something to avoid.”
This becomes even more important if the limit drops after the election, he adds. “With less AIA relief available, businesses of all sizes will be forced to strategically consider which investments carry the most long-term value. So why not leave the allowance for plant purchases such as tools, fixtures and vital equipment and gain 100% tax relief all of the time regardless of the AIA changes?”
Vehicles, Batey’s area of primary expertise, are not necessarily a good choice for AIA investments, he says. Instead, he advises considering a flexible vehicle acquisition method, through which businesses will benefit from Revenue Allowance, which delivers 100% tax relief on these rental costs.
“If you take away only one thing from this article, remember that investing in assets – such as expensive fleet vehicles – may provide immediate tax relief, but in the long run, if you’re seriously looking at how best to benefit from the AIA then investing in depreciating assets may not be the best strategy for your business,” Batey concludes. “Depreciation of new fleet vehicles in year one can be from 10% to 40%, offsetting any gains from the AIA.”
Tax relief plays an integral role in freeing up capital for investment. But it’s important to keep your finger on the pulse with schemes like the AIA, which ease financial burden and ultimately allow businesses to grow.
Competent and courteous service.
"Marie was knowledgeable and helpful. I feel able to recommend the service given without reservation. David Slesenger"This review was posted by David Slesenger on the 16th of August 2016
"Nadia was very helpful"This review was posted by Robin on the 16th of August 2016
Excellent Customer Service *****
"Jonathan Burgess is an asset to Switch My Business. He made me feel at ease and was more than helpful at all times. He made regular contact and guided me through the whole process which made switching a breeze. I just wish there were more customer service advisers like Jonathon whose friendly and happy demeanour make your day a much nicer one. Well done Switch my business and more importantly thank you Jonathon for all your hard work! Maria Owen Lodgecrest"This review was posted by Maria Owen on the 17th of August 2016
EXCELLENT CUSTOMER SERVICE
"I totally agree with a customer maria owen,Jonathan Burgess was such a pleasure dealing with and is truly a asset to the company, he made it very easy to switch my electricity companies, Jonathan Burgess was very helpful, easy to talk to it was like talking to a friend not just a customer adviser. I would definitely recommend switchmybusiness and try get hold off Jonathan Burgess if possible and have the same excellent service as I did. Rajan Shanan"This review was posted by Rajan Shanan on the 19th of August 2016
Excellent and very helpful
"Arron who dealt with my switch of energy and gas has been a huge help and extremely efficienct and easy to deal with. Despite British Gas throwing obstacles in the way at every turn he has doggedly stuck to his task and saved the day. Thanks Arron."This review was posted by Rod Pryce-Jones on the 19th of August 2016