Temporary increase in Annual Investment Allowance: initial equality impact assessment
Published 4 November 2019
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Project objectives
This measure introduces a temporary increase to the Annual Investment Allowance (AIA) limit. The limit was increased at Budget 2018. It took effect from 1 January 2019 and will last for 2 years. It will end on 31 December 2020 and the limit will then return to its permanent rate on 1 January 2021.
The proposed rate of increase will be from £500,000 to £1 million. Businesses will claim the allowance through the specific boxes in their tax return.
We also want businesses to make any adjustment through the tax return if they dispose of the asset and need to make a balancing adjustment.
Customer groups affected
The customer groups that will be impacted by the change are:
- sole traders
- businesses investing in qualifying plant and machinery
What customers will need to do
Customers need to know:
- there is already an established process for claiming AIA, which is not changing
- businesses will need to become familiar with the new legislation to ensure they meet eligibility when calculating their capital allowances
- customers will access the service through their tax return, using specific boxes
- the increase in allowance took effect on 1 January 2019 and lasts for 2 years, until 31 December 2020
Assessing the impact
We assessed the equality impacts on all the protected characteristic groups in line with the Equality Act and Public Sector Equality Duty and section 75 of the Northern Ireland Act.
Racial groups
Impact on customers
The temporary increase in AIA population will be made up of diverse racial groups but there is no evidence to suggest any specific impacts on customers in this protected characteristic group.
Disabled and not disabled
Impact on customers
No evidence, as above.
Gender
Impact on customers
No evidence, as above.
Gender reassignment
Impact on customers
No evidence, as above.
Sexual orientation
Impact on customers
No evidence, as above.
Age
Impact on customers
No evidence, as above.
Religion or belief
Impact on customers
No evidence, as above.
Pregnancy and maternity
Impact on customers
No evidence, as above.
Marriage and civil partnership
Impact on customers
No evidence, as above.
People with dependents and those without
Impact on customers
No evidence, as above.
Political opinion (for Northern Ireland only)
Impact on customers
No evidence, as above.
People who use different languages (including Welsh Language and British Sign Language)
Impact on customers
No evidence, as above.
Opportunities to promote equalities
We have considered opportunities to promote equalities and good relations between people in each of the equality groups, but none have been identified within the scope of this project.