Changes lie ahead to the way in which tax relief is claimed on capital expenditure – planning is essential over the next 2 years as tax reliefs are erroded to help correct the well publicised budget deficit!

Jonathan Crowther summarises the new regime…

The 100% Annual Investment Allowance (AIA) limits are:

  • Year to 5 April 2010 – limit of £50,000
  • For the 2 Years to 5 April 2012 – the limit increases to £100,000
  • From 6 April 2012 – the limit will be slashed to £25,000

Expenditure over the AIA that currently attracts 20% allowances each year will only attract allowances at 18% from April 2012.

Cars with Private Use will only attract 20% or 10% allowances depending on CO2 emissions (reducing to 18% and 8% from 6 April 2012).

Agricultural Building Allowances will be totally scrapped by April 2011.  This removes tax relief on the structure of any farm buildings! 

Integral Features within a building will need to be assessed and capital allowances are available at 10% up to 5 April 2012 or 8% thereafter.

We urge all clients and especially farmers to plan your capital expenditure and talk to your accountant to maximise any tax relief.  As always, we advise you to only buy equipment for commercial reasons and not just to achieve tax savings.

For more information or to arrange a consultation please contact:

Jonathan Crowther FCA or Sophie Howard ACA at

Pershore (01386 552644) or Ledbury (01531 631500) 

Email: farming@crowther.co.uk