Investment tax break hits record as UK companies go for growth

 
Ollie Gordon
UK BUSINESSES will invest a record £2.8bn this year under the Annual Investment Allowance, as firms look to grow after years of underinvestment, commercial finance group LDF said yesterday.

Introduced in 2008, the Annual Investment Allowance allows businesses making capital investments to claim a deduction of up to £500,000 from their taxable profits.

HMRC has predicted capital investments by UK businesses using the scheme to rise 22 per cent from the £2.3bn invested last year.

LDF said the figures demonstrated that companies are now committed to investing in growth after a long period of stilted investment following the credit crunch and economic downturn, but warned the government against its planned reduction of the limit to £25,000 at the end of this year.