Back in March, we posted an article on the 130% super deduction scheme introduced for capital expenditure. This was announced by the Chancellor and meant that companies could enjoy a 130% deduction on the cost of new plant or equipment, providing that it was purchased before the 1st of April 2023. Other assets such as fixtures and integral features in a company building would also qualify for a 50% first-year deduction if purchased before the same date.

With this in mind, there are now two major restrictions to these investment reliefs; these are:

  • The assets must be purchased new (not second hand)
  • The super-deductions can only be claimed by companies

There is also an alternative to these reliefs; the Annual Investment Allowance (AIA), which allows up to £1m of the costs to be relieved. The AIA cap was set to reduce to £200,000 per year from the 1st of January 2022, but we can now confirm that it will remain at £1m until the 31st of March 2023.

These schemes offer a unique opportunity to invest in new equipment such as vehicles; however, we highly recommend that you speak with our team before making any investment to check the tax implications. Contact us to book an appointment.