Temporary Super Deduction and Special Rate First Year Allowance

The Chancellor’s budget announcement in March set out plans for a new Capital Allowances relief exclusive to Companies. For expenditure incurred from 1 April 2021 until 31 March 2023, companies can claim 130% capital allowances on qualifying plant and machinery and 50% first year allowances on special rate investments.

Tax reliefs available for businesses considering electric cars

The Government’s announcement on their plan to ban the sale of petrol and diesel cars in the UK from as early as 2030 has left many businesses concerned about the cashflow impact of replacing business vehicles.

Budget 2020: Positive News on Research & Development (R&D) Tax Relief and Capital Allowances

The Budget made it clear that the UK’s success in the global economy will be rooted in innovation and cutting-edge technology.  Plans to significantly increase public R&D investment to £22 billion per year by 2024-25 were confirmed, increasing direct support for R&D to 0.8% of GDP which places the UK among the top quarter of OECD nations  

Tax Relief for Building Costs

Where contracts are entered into after 29 October 2018 for construction projects on non-residential properties, taxpayers can now potentially benefit from a claim for Structures & Building Allowances (“SBA’s”) on these costs. The claim is made at a rate of 2% per annum (on a straight-line basis) and can be made if a qualifying activity is being carried out.  

Enhanced Capital Allowances

The 2018 budget announced the elimination of Enhanced Capital Allowances (“ECAs”) for expenditure on energy and water efficient plant and machinery from 1 April 2020 for companies and 6 April 2020 for unincorporated businesses.  This date is fast approaching and it is important that anyone who is considering investing in ‘energy-saving’ or ‘environmentally friendly plant machinery’ consider if the purchase can be made prior these dates to enable them to benefit from the attractive cash flow opportunities that still exist.  

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