In the March 2021 Budget the government announced the super-deduction for capital allowances.<\/p>\n
The super-deduction offers 130% first-year relief on qualifying main rate plant and machinery investments until 31 March 2023 for companies.<\/p>\n
The relief equates to a reduction in tax of 25p for every \u00a31 spent, for example:<\/p>\n
If you spend \u00a310,000 on qualifying machinery you get a tax deduction as follows:<\/p>\n
\u2022 \u00a310,000 x 130% = \u00a313,000
\n\u2022 Tax at 19% = \u00a32,470
\n\u2022 % deduction is \u00a32,470\/\u00a310,000 = 24.7%<\/p>\n
Assets that qualify for the super-deduction must be NEW, second-hand items do not qualify, and they include:<\/p>\n
\u2022 Machinery
\n\u2022 Computer equipment and servers
\n\u2022 Tractors, lorries and vans
\n\u2022 Office chairs and desks
\n\u2022 Electric vehicle charge points<\/p>\n
It is important to note that when the assets on which super-deduction is claimed are sold, they are subject to a balancing charge based on 130% of the disposal proceeds if they are sold before 1 April 2023.<\/p>\n
Furthermore, there is a 50% first year allowance for special rate assets until 31 March 2023 for companies. Special rate assets include integral features such as:<\/p>\n
\u2022 Wiring
\n\u2022 Lighting
\n\u2022 Heating<\/p>\n
The Annual Investment Allowance is \u00a31,000,000 until 1 January 2022 when this will reduce to \u00a3200,000.<\/p>\n
If you have any questions in relation to super-deductions tax relief please do not hesitate to contact us.<\/p>\n","protected":false},"excerpt":{"rendered":"
In the March 2021 Budget the government announced the super-deduction for capital allowances. The super-deduction offers 130% first-year relief on qualifying main rate plant and machinery investments until 31 March 2023 for companies. The relief equates to a reduction in tax of 25p for every \u00a31 spent, for example: If you spend \u00a310,000 on qualifying […]<\/p>\n","protected":false},"author":5,"featured_media":4109,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[1,21],"tags":[],"class_list":["post-4110","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog-articles","category-accountancy-news"],"yoast_head":"\n