Focus On Capital Allowances and Buying Plant & Machinery
When a trading business buys equipment (Plant and Machinery) under the current tax laws, Capital Allowances can be claimed based on the cost of the equipment against the trading profit of the business. If the equipment is purchased outright then the expense has been incurred when the new piece of equipment becomes yours and capital allowances become available on the date of purchase.
When buying equipment using a hire purchase agreement the timing of when you can claim your tax allowances is different to buying the equipment outright. You must consider the date when the equipment comes into use in your business.
This is especially relevant when buying equipment some time before it will be used.