| The government has bought
forward the closure of a loophole that
allowed businesses to accelerate capital
allowances claims for plant and machinery
and obtain advantageous early tax relief.
The change was announced on 12 August
by Economic Secretary to the Treasury
Justine Greening and took effect
immediately.
The closure of the loophole, which was
originally proposed for April 2012, was
brought forward because the government had
become aware that an avoidance scheme was
being promoted that took advantage of the
loophole.
Justine Greening said: “By ending this
loophole we will preserve important
revenue while maintaining a fair system of
capital allowances to support business
investment.”
The capital allowances regime will
undergo major reform from April 2012. The
annual investment allowance, which offers
tax relief at 100 per cent on qualifying
expenditure in the year of purchase, will
be reduced to £25,000, while the rates of
writing down allowances are also set to
fall.
LINK:
Capital allowances guidance |
