Rishi Sunak announced the budget a couple of weeks ago and if you blinked you might have missed a very important detail.
In a nutshell, the super-deduction tax break means that you can claim 130 per cent of what you spend on equipment for your business against taxable profits!
The government has only released very basic information so far and there are a lot of questions to still be answered. But from what they have said already it looks like for expenditure incurred for two years (from 1 April 2021 until the end of March 2023), companies can claim 130% capital allowances on qualifying plant and machinery investments.
In conversation with the Telegraph, UK Economist James Smith drew parallels between super deduction and Rishi’s well publicised ‘East out to Help Out’ scheme . The hope is that this ‘super deduction’ will encourage business to invest after a significant slump in business investment due to the Coronavirus pandemic.
In a statement HM Treasury explained that “Making capital allowance more generous works to stimulate business investment. As a result, these measures can promote economic growth and counter business cycles. The super-deduction will give companies a strong incentive to make additional investments, and to bring planned investments forward”
According to the government information released, most tangible capital assets used in the course of a business are considered ‘plant and machinery’ for the purposes of claiming capital allowances. They have not produced an exhaustive list of exactly what qualifies (although they have made it clear that second hand assets will not be included), but for guidance the government have suggested the following assets that may qualify for the super-deduction:
The example given by HM Treasury and published as part of the super deduction guidance is as follows:
Further guidance on eligibility criteria can be found here. However full technical guidance is yet to be released.
This could be a very exciting way to afford the much needed IT infrastructure updates that you practice requires. For example:
If you would like help to understand where your practice could benefit, just book in a free consultation with one of our Veterinary IT Experts here.