Reverting to the standard annual investment allowance: Impact on incorporated businesses

In the second part of our feature on the end of the temporarily increased annual investment allowance on 31 March 2023, we examine the impact which the reversion to the standard allowance will have on businesses within the charge to corporation tax.

As the temporarily increased annual investment allowance (AIA) is due to revert to the standard £200,000 AIA limit from 1 April 2023, the transition period will have potentially significant impacts on businesses claiming the allowance, resulting in some surprising results in relevant tax assessments. The first part of this article was published in the April 2022 issue of Tax Adviser. Here, we examine the impact of the transition on incorporated businesses.