Search News


 

Lloyd and Co

Lloyd & Co
Chartered Accountants

103-105 Brighton Road
Coulsdon
Surrey, CR5 2NG
020 8668 0500
This email address is being protected from spambots. You need JavaScript enabled to view it.

Source: HM Treasury | | 08/04/2021

The new super-deduction tax break, that will allow companies to deduct 130% of the cost of any qualifying investment from their taxable profits, is available on most new plant and machinery investments that ordinarily qualify for 18% main rate writing down allowances. This means that for every £1 a company invests they can reduce their Corporation Tax bill by up to 24.7p. The new temporary tax relief applies on qualifying capital asset investments from 1 April 2021 until 31 March 2023. 

The super-deduction is designed to help companies finance expansion in the wake of the coronavirus pandemic and help to drive growth. This change makes the Capital Allowance regime more internationally competitive, lifting the net present value of the UK’s plant and machinery allowances from 30th in the OECD to 1st.

Commenting on the introduction of the super-deduction, the Chancellor of the Exchequer Rishi Sunak said:

'The super-deduction is the biggest two-year business tax cut in modern British history – driving our economy by helping businesses to invest, grow and support our Plan for Jobs. I urge firms across the UK to invest in our recovery by taking advantage of this great opportunity.'

An enhanced first year allowance of 50% on qualifying special rate assets has also been introduced for expenditure within the same period. This includes most new plant and machinery investments that ordinarily qualify for 6% special rate writing down allowances. 

The measures have effect in relation to qualifying expenditure from 1 April 2021 and excludes expenditure incurred on contracts entered into prior to Budget day on 3 March 2021. 



Latest News

Vaccine for your business
20/04/2021 - More...
There is a poignant similarity between the effects of COVID on us personally and our businesses. Thankfully, the

A reminder that not all costs are costs…
20/04/2021 - More...
Costs are defined as something that has to be paid or spent to acquire something. Costs include the acquisition

HMRC’s new penalty regime
15/04/2021 - More...
HMRC’s new points-based penalty regime for late submission and payment will start from 1 April 2022. The changes will