Tax change to hit UK businesses for £900m

Link: Treasury defends policy on corporation tax

Company cash flows would be hit because of the government’s plans to provide a slower rate of tax relief on assets such as plant and machinery, the accounting body said.

Tax relief could move from a system based on capital allowances to one based on how assets are depreciated in company accounts. Although the two systems offer about the same value of tax relief, capital allowances do so at a much faster rate.

The Treasury plans could affect a whole range of companies because plant and machinery includes IT equipment.

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