At the moment, firms, including sole traders, partnerships and companies, that invest in qualifying assets, commercial vehicles, plant, computers and other equipment can write off up to £100,000 in each trading year against their business profits.
If you are self-employed and a higher rate tax payer this is a particularly beneficial allowance - you could recover 40% or possibly 50% of your investment (up to the £100,000 limit).
However, this allowance is to be reduced from April 2012 to just £25,000.
Businesses should re-examine their investment plans in the light of this announcement. You still have some months to act - get your investment funding in place if you have a genuine commercial reason for purchasing.
We would be delighted to help you undertake a tax planning review to make sure you make the most of the opportunity.
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Major investment? Do it now!
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Laura O'Sullivan ATT