The New Super-Deduction!

Between 1 April 2021 and 31 March 2023 companies investing in qualifying new plant and machinery assets will be able to claim:

• a 130% super-deduction capital allowance on qualifying plant and machinery investments
• a 50% first-year allowance for qualifying special rate assets

An example of the super-deduction:

• A company incurring £100,000 of qualifying expenditure decides to claim the super-deduction
• Spending £100,000 on qualifying investments will mean the company can deduct £130,000 (130% of the initial investment) in computing its taxable profits
• Deducting £130,000 from taxable profits will save the company up to 19% of that – or £24,700 – on its corporation tax bill