tax super deduction

Capital Allowances – Super Deduction

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Capital Allowances – Super Deduction

  • From 1st April 2021 until 31st March 2013, companies who invest in qualifying plant & machinery will be eligible for a 130% capital allowance deduction.
  • This essentially allows companies to reduce their taxable profits by 130% of the value of the assets purchased (with no upper cap to the relief available).
  • Normally, qualifying plant & machinery would have been eligible for a 100% capital allowance deduction up to a maximum annual limit.
  • For assets that fall under the ‘special rate pool’ category, they are eligible for an accelerated relief of relief at 50% (normally these assets only attract relief at 6%)
  • The new Super Deduction is only available to limited companies.
  • The relief is for new, unused plant & machinery – not second-hand assets.
  • As with any new tax incentives, there are various pitfalls and issues to consider.
  • Therefore, it is important to plan accordingly.
  • If you are considering purchasing any plant & machinery and would like to discuss the tax relief available please do not hesitate to contact us at tax@seancavanaghandco.com or call on 028 8775 5880.