As part of the Chancellor’s Budget 2021 announcement, a new “super-deduction” capital allowance scheme was announced. This means that companies will be able to claim 130% capital allowances on qualifying plant and machinery investments purchased between 1 April 2021 and 31 March 2023.
Under the super-deduction, for every pound a company invests, their taxes are cut by up to 25p.
This scheme is available to all businesses — big or small.
HMRC says that “Most tangible capital assets used in the course of a business are considered plant and machinery for the purposes of claiming capital allowances.”
These can include:
- Office furniture
- Computers, tablets, laptops
- Business mobile phones
- Carpenters’ tools
- Office chairs and desks
- Electric vehicle charge points
- Office bookshelves
- Office TVs
- Digital display panels
- Air conditioning units
Why have these changes been applied?
Following the Covid-19 pandemic, the usual level of business investment has fallen. By making capital allowances more generous, the super-deduction will give companies a strong incentive to make additional investments and to bring planned investments forward, encouraging nationwide economic growth.
Where can I find out more information?
Further details about these changes and the additional capital allowance changes can be found here.