Tax Incentives

Tax incentives for air conditioning installations

Enhanced Capital Allowance (ECA)

Enhanced Capital Allowances (ECAs) are a straightforward way for a business to improve its cash flow through accelerated tax relief. The ECA scheme for energy-saving technologies encourages businesses to invest in energy-saving plant as specified on the Energy Technology List (ETL) which is managed by the Carbon Trust on behalf of Government.

The ECA scheme provides businesses with 100% first year tax relief on their qualifying capital expenditure.

Further details can be obtained from the ECA and Carbon Trust websites.

Annual Investment Allowance (AIA)

The Annual Investment Allowance (AIA) offers 100% tax breaks (equal to ECA) available for most new equipment investments up to £100,000 a year (increased this year from £50,000) and the purchases do not need to be listed on the Energy Technology List (ETL).

The AIA is effectively a 100% first-year allowance for business expenditure on almost all plant and machinery (apart from cars) capped at £100,000 a year. It is available to businesses regardless of their size or legal form and applies to expenditure incurred on or after 1st April 2010 for businesses liable for corporation tax (CT), and or after 6th April 2010 for businesses liable for income tax.

For further information please click here

For information on the increased allowance please click here

Interest Free Energy-Efficiency Loans

The energy-efficiency loans from the Carbon Trust are a cost effective way to replace or upgrade your old wasteful existing equipment with a more energy efficient system. The loan scheme is designed so that anticipated energy savings offset the repayments of the loan, which means the equipment should pay for itself and you should continue to make savings year on year.

Small or medium-sized enterprises (SMEs) that meet the qualify criteria could borrow from £3,000 to £500,000 depending on the amount and type of energy saved. It is government funded, unsecured and interest free.

Applying is straight forward - further details can be obtained from the Carbon Trust website.