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Super-Deduction


In March 2021 the Chancellor announced a Super-Deduction in the Budget with a positive impact for businesses within the UK.

The Super-Deduction is aimed at capital purchases, purchases where ACF can look at ways to fund the purchase. Super-Deduction is great news for business. There will be an allowance of 130% on most new investments that are made Between 1 April 2021 and 31 March 2023.  Companies investing in qualifying new plant and machinery plus a number of other capital purchases will benefit from new first year capital allowance.

You are allowed to claim a super-deduction providing allowances of 130% on most new plant and machinery investments that ordinarily qualify for 18% main rate writing down allowances. There is also a first year allowance of 50% on most new plant and machinery investments that ordinarily qualify for 6% special rate writing down allowances.

The super-deduction will allow companies to cut their tax bill by up to 25p for every £1 they invest, ensuring the UK capital allowances regime is amongst the world’s most competitive.

The government has offered unprecedented support for businesses during Covid. Even so, pandemic-related economic shocks and the accompanying uncertainty have chilled business investment. 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. ACF Direct is here to help look at many different finance options for your capital purchases and take advantage of this scheme.

There is a Government factsheet available that can answer more of your questions on Super Deduction – https://www.gov.uk/guidance/super-deduction

This relief is not available for unincorporated businesses.