Managing Director Gateley Capitus
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Istock_rentsign_Javier Vilchez

Super deduction U-turn enables landlords to claim


Rishi Sunak’s super deduction scheme is now set to apply to the initially excluded landlord lessors after the government changes its mind and amends the Finance Bill.

21st May 2021
Managing Director Gateley Capitus
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Given the importance of commercial property sector to our economy, it was always mystifying why landlords were excluded from claiming the new capital allowances super deduction. However, that situation is about to be rectified.

What is super deduction?

In Sunak’s Budget on 3 March 2021, a number of new tax incentives were introduced to encourage investment and re-boot the economy in a post-pandemic bounce-back. The new 130% Super Deduction First Year Allowance (FYA) lowers tax bills by around an extra third for expenditure on new ‘main pool’ plant and machinery.

The accompanying 50% Special Rate FYA, or SR allowance as it is known, gives an eight-fold acceleration of tax relief compared to the 6% writing down allowance (WDA) previously available for a range of other plant and machinery assets.

This is a time-limited opportunity because the new measures are only available for expenditure incurred between 1 April 2021 and 31 March 2023.

Why was the door shut on landlords?

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25th May 2021 17:30

Can I ask if the change of heart will extend to companies that hire out plant and machinery. My client hires out forklift trucks on a long term and short term basis. If the AIA is to be cut from 01/01/2022 to £200,000 then losing out on the super deduction will have quite an impact on the allowances they can claim.

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