Capital allowances are a way to shrink your tax bill. They apply to certain expenses used for business purposes in your practice, like equipment, chairs, and furniture.
To qualify, you must be a UK taxpayer, use or own a practice, and have profits for tax relief. They’re treated like expenses, deducted from your profits or added to losses at the year’s end.
Allowances account for assets losing value due to use and wear.
What allowances are there?
- Annual Investment Allowance (AIA) gives 100% tax relief in the purchase year (with exceptions).
- First year allowances (FYA) let you deduct part of the asset’s cost in the purchase year.
- Writing down allowances (WDA) apply when you didn’t claim FYA.
When to get advice?
You can claim at any time you own the asset. Review past assets for unclaimed reliefs. If you’re changing your practice, call us to check if it qualifies. For new equipment or refurbishing, we can advise on eligibility.