Recent news
The long awaited Budget on 22 June 2010 announced a number of capital allowances changes.
Capital Allowances Rates
- General Pool Plant writing down allowances will fall to 18% from April 2012.
- Special Rate Pool writing down allowances will fall to 8% from April 2012.
Annual Investment Allowance (AIA)
- From April 2012 the AIA is decreased from £100,000 to £25,000.
- The AIA is available for both general and special rate pool expenditure and applies to individuals (carrying on a qualifying activity), companies and partnerships with only individual partners.
Furnished Holiday Lettings (FHL)
- Capital allowances will continue to be available on FHL in tax year 2010/11.
- Consultation will start in Summer 2010 regarding proposed changes to the FHL regime.
Zero Emission Goods Vehicles
- As previously announced from April 2010, expenditure on new and unused zero-emission goods vehicles will attract a 100% FYA.
- The FYA will apply for five years and has an overall expenditure cap of €85m per undertaking over the five year period. Legislation will set out more details regarding the cap.
- The usual restrictions to the availability of FYA apply (e.g. leasing).
Other issues
- The main rate of corporation tax will fall to 27% from 1 April 2011 with a further 1% drop annually until 2014/15 when the rate will be 24%.
- The small profits rate of corporation tax will fall to 20% from 1 April 2011.
- The Government will set out a more detailed programme for Corporation Tax reform in the Autumn and "It intends to develop its view that in general a broad tax base, a low rate and a more territorial approach will improve competitiveness".
(References above to April 2010 or 2012 mean 1 April 2010 or 2012 for corporation tax and 6 April 2010 or 2012 for income tax, unless otherwise stated.)
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