Annual Investment Allowance (AIA) Checker (2026/27).

The AIA provides a 100% first-year deduction for qualifying plant and machinery expenditure up to £1,000,000 per year. This means the full cost can be deducted from taxable profits in the year of purchase — giving an immediate CT saving rather than spreading the relief over several years via Writing Down Allowances.

Most plant and machinery qualifies for AIA — including equipment, machinery, computers, commercial vehicles, and integral building features. Cars do not qualify for AIA but can claim Writing Down Allowances. The AIA does not apply to assets you already owned before becoming a business owner, or assets bought from connected parties.

Expenditure above the £1m AIA limit falls into the main pool (18% Writing Down Allowance per year) for most plant and machinery, or the special rate pool (6% WDA) for assets with long economic life or integral features. The AIA covers the most expensive assets first, so careful ordering of purchases can maximise the benefit.

Cars are specifically excluded from AIA. New zero-emission cars (0g/km CO2) qualify for a 100% first-year allowance. Cars with CO2 up to 50g/km go into the main pool at 18% WDA. Cars with CO2 above 50g/km go into the special rate pool at 6% WDA. Second-hand electric cars do not qualify for the 100% FYA but do get the 18% main pool rate.

Yes, AIA applies to second-hand plant and machinery as well as new assets, provided you buy them at arm's length. Assets bought from connected persons (such as associates or related companies) are excluded from AIA.