Measure
The government has announced a permanent increase to the annual investment allowance limit of £1m for expenditure incurred on the provision of plant and machinery. This had been due to revert to £200,000 from 1 April 2023.
This measure will affect businesses that incur capital expenditure on qualifying plant and machinery.
The measure will come into effect on 1 April 2023.
The measure maintains the existing incentives for businesses to invest in both main pool and special rate plant and machinery. For many small and medium sized businesses, fixing the annual investment allowance limit at a permanent level of £1m should provide a full write-off for investment in plant and machinery. For larger businesses, the commitment to permanently fix the annual investment allowance limit should remove complexity and uncertainty.