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Claim full expensing or 50% FYA
04/07/2024

Full expensing allows for a 100% first-year capital allowance for qualifying plant and machinery assets and came into effect last April. To qualify for full expensing, expenditure must be incurred on the provision of “main rate” plant or machinery.

Full expensing is only available to companies subject to Corporation Tax. 

Plant and machinery that may qualify for full expensing includes (but is not limited to):

  • machines such as computers, printers, lathes and planers;
  • office equipment such as desks and chairs;
  • vehicles such as vans, lorries and tractors (but not cars);
  • warehousing equipment such as forklift trucks, pallet trucks, shelving and stackers;
  • tools such as ladders and drills;
  • construction equipment such as excavators, compactors, and bulldozers; and
  • some fixtures such as kitchen and bathroom fittings and fire alarm systems in non-residential property.

Under full expensing, for every pound a company invests, their taxes are cut by up to 25p. For “special rate” expenditure, which does not qualify for full expensing, a 50% first-year allowance (FYA) can be claimed instead.

Businesses can also continue to use the Annual Investment Allowance (AIA) to claim a 100% tax deduction on qualifying expenditure on plant and machinery of up to £1m per year. This includes unincorporated businesses and most partnerships.


Poole Office

Hill Osborne
Tower House, Parkstone Road
Poole
Dorset
BH15 2JH
 
Tel: 01202 678555
E:   This email address is being protected from spambots. You need JavaScript enabled to view it.
 
Company Registration No: O7430971
VAT Registration No.107585703

Wimborne Office

Hill Osborne
Beaufort House, 2 Cornmarket Court
Wimborne
Dorset
BH21 1JL
 
Tel: 01202 849169
E:   This email address is being protected from spambots. You need JavaScript enabled to view it.
 
Company Registration No: O7430971
VAT Registration No.107585703

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