Temporary 40% FYA

[GaryMc]

Hypothetical situation

A co buys 2 assets on 01/4/09 - one costing £20k and the other £40k

Could it claim AIA against asset 2 in whole and then claim that £10k of the first asset qualifies for AIA and the other £10k qualifies for FYA thus giving total allowances of £54k?

CAA2001 s 52(4) says that you can claim FYA on whole or part of qualifying expenditure and FA08 s51A(4) seems to suggest the same for AIA

Does anyone read it differently?

[Blackberry]

You can claim 100% allowances on the first £50k worth of qualifying assets. After that its only 20% allowances not 40%

so in your example the allowances claimable are £52k.

Dont forget that anything over the first £50k will get 20% allowances each year until they are sold or scrapped.

[GaryMc]

Hi Tony - the Budget introduced a temporary 40% first year allowance from 01/4/09

[Blackberry]

So it did!

One of the pitfalls of working in practice is your usually in the past! Was thinking of year to 5th April 2009 :D

[Maslins]

Gary, I think what you're suggesting sounds entirely correct.