Enhanced Capital Allowances (ECAs) enable a business to claim 100% first-year capital allowances on their spending on qualifying plant and machinery.

Businesses can write off the whole of the capital cost of their investment in these technologies against their taxable profits of the period during which they make the investment.

This means that you may be entitled to ECA which can deliver a helpful cash flow boost and a shortened pay back period. You must be a company or partnership paying corporate tax and the total amount directly attributable to the installation including consultancy charge, transport, equipment and pipework etc and direct minor builders work may considered for these benefits.

This allows 100% of the installation value to be written off under the ECA with the taxable sum taxed to reflect the total sum from 0% to 32%. The saving to a company is reflected in cash flow and either investment interest or reduction in interest payments. The overall tax saving depends on interest rates, tax as a percentage, profit and amortisation times, the value of the installation having been considered first.

For more information please visit the Enhanced Capital Allowances website: