Companies can cut their tax bill by 25p for every £1.00 invested.
From 1 April 2021 until 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
The super-deduction allows companies to cut their tax bill by up to 25p for every £1 they invest, which makes the UK capital allowance regime amongst the world’s most competitive.
Business solar PV and EV charging are both in the scope for new plant and machinery that your company can claim. This incentive for companies to become greener is a great welcome. The Treasury has also announced rate exemptions for onsite solar and storage, these are exciting times for the solar industry.
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 encourages firms to invest in productivity-enhancing plant and machinery assets that will help them grow and to make investments now.
This can only be claimed up to April 2023 so there is no better time than now. Also, as energy prices continue to rise the cost of energy will probably be more than the cost increase of install and with the system having a lifetime of 25 years the future impact of delaying must be considered.
Find out more about solar PV for business.
Find out more about the Government scheme:
Super Tax Deduction