What is Super-Deduction?

As announced in the March 2021 Spring Budget, from 1st April 2021 until March 2023, companies investing in qualifying new plant and machinery will be able to claim:

  • A 130% first-year capital allowance for qualifying plant and machinery assets
  • A 50% first-year allowance for qualifying special rate assets

The super-deduction will allow companies to cut their tax bill by up to 25p for every £1 they invest. This super-deduction will encourage firms to invest in productivity enhancing plant and machinery assets that will help them grow, and to make those investments now.

Now has never been a better time to buy new assets for your business. Please use our calculator below to see the potential savings you could make:

The calculator is for illustrative purposes only. Please speak with your accountant to discuss your individual circumstances.

What is plant and machinery?

Most tangible capital assets used in the course of a business are considered plant and machinery for the purposes of claiming capital allowances. There is not an exhaustive list of plant and machinery assets.

The kinds of assets which may qualify for either the super-deduction or the 50% FYA (First Year Allowance) include, but are not limited to:

  • Solar Panels
  • Computer equipment & servers
  • Tractors, lorries and vans
  • Ladders, drills and cranes
  • Office chairs and desks
  • Electrical vehicle charge points
  • Refrigeration units
  • Compressors
  • Foundry equipment

Annual Investment Allowance – Used Assets

Also announced in the March 2021 Budget was a £1m AIA (Annual Investment Allowance), whereby 100% of Used Assets can be offset against taxable profit, although this is only available until 31st December 2021.

Speak to one of our experienced commercial managers about super-deduction for your business.

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