Capital Allowances
C
apital allowances are based on buying assets that you use in your business. Knowing what these are and how your profits are affected can be made easier by hiring an accountant or tax advisor. Often equipment such as plant and machinery, as well as business vehicles such as cars and lorries, would fall under the bracket of capital allowances.
Self Assessment Tax Returns (SATRs) are the principle method of claiming your allowances by ensuring all the information in the document is filed correctly. This usually involves hiring an accountancy firm to get an overall picture of your operations throughout the financial year so that everything can be submitted on time and accurately. If this is all done in the right way you will avoid penalties and paying too much tax.
Whatever your set up we can help with your tax planning and making the most of capital allowances in your business.
EXPLAINER
There are also many other business costs such as day to day running costs that are considered capital allowances so it is a good idea to get a solid understanding of where you can make tax savings. The structure of your business can also affect your allowances – for example a Sole Trader earning under a certain amount may be able to use the Cash Basis system instead.
