What is the super deduction?
Businesses can claim 130% first year relief on qualifying plant and machinery bought between 1st April 2021 and 31st March 2023. Under the super deduction, for every pound a company invests, their taxes are cut by up to 25p. The government announced this as part of the 2021 Budget in March, in the hope that the scheme will encourage business investment and stimulate economic growth. The super deduction scheme is only available to Limited Companies. Unfortunately sole traders cannot benefit. To give an example of the available savings, if you spend £100,000, the corporation tax deduction will be £130,000. You will save 19% on £130,000, which is £24,700.