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Annual Investment Allowance · UK

AIA Equipment Tax-Saving Calculator

Buying a van, kitchen, machine or laptop fleet before year-end? See exactly how much corporation tax it shaves off — using the real marginal-relief curve, not just a flat 19%.

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Corporation Tax

19% / 25% with marginal relief between £50k and £250k.

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Principal + APR + months → monthly payment + total interest.

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Director extracting cash from a Ltd? Find the optimal split.

Common questions

What is the Annual Investment Allowance?
AIA lets a UK company deduct 100% of qualifying plant-and-machinery spend from taxable profits in the year of purchase, up to a £1,000,000 cap. It's a corporation-tax cash-flow tool: spend now, lower your CT bill now.
What counts as plant and machinery?
Tools, vans (not cars), computers, equipment, furniture, integral features, software. Cars are excluded — they go through capital allowances at 6%/18% special rates. Buildings themselves are excluded; specific integral features inside them qualify.
What if my equipment cost is more than my profit?
AIA can only reduce profit to zero — it doesn't create a tax refund. The unused portion becomes a trading loss that can be carried back one year or forward indefinitely against future profits.
Does AIA apply to sole traders too?
Yes. The AIA is identical for unincorporated businesses, but the tax saving is at your income-tax rate (20%/40%/45%) plus Class 4 NI, not corporation tax. This particular calculator assumes a Ltd company.
Is it worth buying equipment just for the tax saving?
No. Tax tail wagging the dog. Only buy what your business genuinely needs. The calc tells you the saving so you can size the actual decision — not invent purchases.