Business tax changes taking effect this week

• All businesses can write off 100% of the first £50,000 of investment in plant and machinery each year against their taxable profits under the new Annual Investment Allowance. This can have a significant impact on Child Tax Credit claims and many people can benefit from caeful tax planning.

• Other capital allowances are being reduced. After the first year, firms can now write off 20pc of the cost of new investment in plant and machinery against their taxable profits, down from 25pc. Industrial, agricultural buildings and hotels begin to lose their 4pc annual allowance against the cost of construction. It falls to 3pc this year and will be phased out completely in 2011. A new 10pc rate for integral fixtures and fittings is also being introduced.

• Empty property relief is reformed. At present unlet industrial properties are exempt from business rates and the tax only becomes payable on office and retail space after three months and then at only half the normal rate. From April 6 this year, full business rates will be due on empty shops and offices, and on industrial space after six months.

• Self-employed people earning up to £30,000 now only need to send HM Revenue & Customs (HMRC) their turnover, expenses and net income following the doubling of the turnover threshold. But accountants said they still have to keep records of what is spent in case of enquiry. HMRC has also removed a disincentive to file early. From April 6, it will have 12 months to launch an investigation from the date the business accounts are filed rather than 12 months from the filing deadline of January 31 each year.