Measure
The government has announced an extension until 31 March 2023 for the temporary annual investment allowance limit of £1m for expenditure incurred on the provision of plant and machinery. The annual investment allowance provides a 100% first year allowance for businesses who incur capital expenditure on the provision of plant or machinery.
Businesses, including companies and groups of companies, who incur annual capital expenditure on plant and machinery assets in excess of £200,000 as from 1 January 2022.
The measure extends the £1m current annual investment allowance limit, previously due to end on 31 December 2021, until 31 March 2023. Thereafter the limit will revert to £200,000.
The measure maintains the existing annual incentives for businesses to invest in both main pool and special rate plant and machinery, which had been due to revert to £200,000 from 1 January 2022. This represents a generous extension to the current annual investment allowance provisions.