In today’s (25 November 2015) Autumn Statement, combined with the Spending Review, there were a few changes to capital allowances.


Annual Investment Allowance (AIA)


Just as a reminder, the most relevant change was announced in the Spring Budget, as the 100% AIA will become £200,000 on 1 January 2016.  It is currently £500,000.


As with previous changes to the AIA, there will be transitional rules for business whose year end is not 31 December 2015.


Enterprise Zones Allowances (EZA)


As announced at the previous Budget, a further round of Enterprise Zones (EZ’s) have been announced.  18 new zones will be created, including 15 in smaller towns and rural areas, with a further 8 previous EZ’s being extended.  The changes will come into effect from April 2016.


As a reminder, EZA is a 100% allowance available to companies installing plant and machinery in designated assisted areas.  The new or extended EZ’s that will attract the 100% allowance are noted below.  Unfortunately EZA is not available to a property business.


  • Infinity Park Extension Derby

  • Humber EZ

  • M62 Corridor EZ

  • Luton Airport EZ,

  • Cheshire Science Corridor EZ

  • Carlisle Kingsmoor Park EZ

  • Hillhouse Chemicals and Energy Enterprise EZ, Fylde

  • Stoke / Staffordshire Ceramics Valley

  • Cornwall Aerohub+

  • North East Round 2 EZ


New EZ’s will also open in Cambridgeshire, Hertfordshire, Aylesbury Vale, Didcot and Greater Anglia, among others, but they will not attract the 100% EZA.




With effect from 25 November 2015, two types of avoidance involving capital allowances and leasing will be countered.  This follows disclosure of tax avoidance schemes, so does not affect normal disposals of fixed plant.


Firstly it will prevent companies from artificially lowering the disposal value of plant and machinery for capital allowances purposes to obtain a tax advantage. 


Secondly it will make any payment received for agreeing to take responsibility for tax deductible lease related payments subject to tax as income.

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