SMALL businesses have until March 31 to take advantage of a valuable tax break on the purchase of a range of IT equipment including printers, computers, third generation mobile phones and software.

"Qualifying businesses can claim 100 per cent first year allowances on IT purchases, and this provides a very helpful boost to cash flow," said Jane Haydon, senior tax manager with independent financial services group Smith & Williamson, which has an office in Salisbury.

"Suppose you spend £5,000 on relevant office equipment this month, this can effectively be used to reduce your taxable profit by £5,000 in this period.

"Compare this with the purchase of non-IT equipment, whereby you could only claim £2,000 or 40 per cent of the cost in the first year."

She warned that if people left it too late, their business would suffer in cash flow terms.

"Although it is possible that the Chancellor may extend the tax break in the forthcoming budget, it is wise to act now and be sure of getting the tax relief."

For the purposes of this tax break, sole traders, partnerships and smaller companies can qualify if any two of the following three conditions apply: In the year concerned, the turnover is not more than £2.8 million, the balance sheet asset total is £1.4 million or less and the business has 50 or fewer employees.