UK Annual Investment Allowance (AIA) Calculator
Simple UK-focused calculator to estimate the amount of qualifying expenditure you can claim under the Annual Investment Allowance (AIA). For guidance on eligibility and limits consult HMRC and gov.uk resources linked below.
- Page updated:
- Jun 10, 2026
- Tool version:
- v1.1.0
Overview
Estimate how much of your capital spending qualifies for the UK Annual Investment Allowance (AIA) and the tax it saves. The AIA gives 100% first-year tax relief on qualifying plant and machinery up to an annual cap (£1,000,000). Enter your qualifying expenditure, the period's AIA limit and your tax rate.
Educational estimate, not tax advice. Eligibility, the treatment of cars and the interaction with full expensing and writing-down allowances can be complex — check HMRC guidance or an accountant.
Results
AIA you can claim this period
$250,000.00
Tax saved from the AIA claim
$62,500.00
Spend above the AIA
$0.00
Writing-down allowance on the excess (18% main pool, year 1)
$0.00
First-year relief as % of total spend
100
How to read the result
- What it means
- The displayed value is an estimate based on your inputs. It represents the calculated scenario under current assumptions, not a guaranteed amount.
- Calculation limits
- The model uses simplified formulas and cannot account for all variables in your specific case (local regulations, personal conditions, temporal changes).
- Next step
- Use the result as a starting point. Adjust parameters to compare scenarios and validate with a professional when needed.
Glossary+−
- Annual Investment Allowance (AIA)
A capital allowance giving 100% first-year tax relief on qualifying plant and machinery up to an annual cap (£1,000,000).
- Plant and Machinery
Equipment, tools and certain fixtures used in a business; the main category of expenditure qualifying for the AIA (cars excluded).
- Writing-Down Allowance (WDA)
An annual reducing-balance allowance (18% main pool, 6% special-rate pool) for expenditure not covered by the AIA or full expensing.
- Full Expensing
A 100% first-year allowance for companies on new and unused qualifying plant and machinery, separate from the AIA.
- Main Pool
The grouping of most plant and machinery for capital allowance purposes, written down at 18% per year.
Key takeaways
Enter qualifying expenditure, the period's AIA limit and your tax rate to see the AIA you can claim, the tax saved and any excess that goes to the writing-down pool.
Estimate only — excludes cars, full expensing, marginal relief and group AIA sharing. Confirm with HMRC guidance or an accountant.
Related calculators
US S-Corp vs. C-Corp Tax Comparison Calculator
SME & Business
Canada Emergency Business Account (CEBA) Loan Repayment Calculator
SME & Business
Canada Scientific Research & Experimental Development (SR&ED) Tax Incentive Calculator
SME & Business
Canada Small Business Deduction (SBD) Calculator
SME & Business
Canada Wage Subsidy (CEWS) Calculator (historical)
SME & Business
Customer Lifetime Value (CLV) to Customer Acquisition Cost (CAC) Ratio Calculator
SME & Business
Worked examples
Example: £250,000 spend, 25% Corporation Tax
A company spends £250,000 on qualifying machinery in a 12-month period.
Interpretation
The full £250,000 is deducted this year, cutting the Corporation Tax bill by £62,500. Nothing falls into the writing-down pool because the spend is within the £1m AIA cap.
Frequently asked questions
What is the Annual Investment Allowance?
A capital allowance giving 100% first-year tax relief on qualifying plant and machinery, up to an annual limit of £1,000,000, against taxable profits. See HMRC guidance.
What happens to spend above the AIA limit?
It is added to the main capital allowances pool and written down at 18% per year on a reducing-balance basis — or a company may claim full expensing on new qualifying assets instead.
Do cars qualify for the AIA?
No. Cars are excluded from the AIA and instead receive writing-down allowances based on their CO₂ emissions. Most other plant and machinery qualifies.
Does my accounting period length matter?
Yes. The £1,000,000 limit applies to a 12-month period and is reduced pro-rata for shorter periods. Adjust the AIA limit field accordingly.
Sources & references
- GOV.UK — Annual Investment Allowance (Claim capital allowances): https://www.gov.uk/capital-allowances/annual-investment-allowance
- GOV.UK — Claim capital allowances: overview: https://www.gov.uk/capital-allowances
- GOV.UK — Corporation Tax rates and reliefs: https://www.gov.uk/corporation-tax-rates
Quality & oversight
- Author
- Ugo Candido, MBA
- Maintained by
- Ugo Candido, MBA
- Page updated
- Jun 10, 2026
- Tool version
- v1.1.0