Veterinary update: Super deduction to be extended?

Published: Tuesday 25 May 2021

A ‘super deduction’ was announced for companies investing in qualifying plant and machinery as part of the Chancellor’s Budget 2021 speech. There is a proposed amendment to the draft legislation which could extend this relief to certain landlords.

The super deduction allows companies to claim 130% capital allowances for capital expenditure on qualifying plant and machinery purchased between 1 April 2021 and 31 March 2023.  The Budget also announced a 50% rate for special rate capital expenditure (e.g. on integral features such as electrical, heating and lighting systems).

There were a number of specific exclusions from both of these reliefs, including purchases of second-hand assets, cars, long life assets and expenditure on assets for leasing.

The proposed amendment is to remove the latter of these exclusions i.e. expenditure on plant and machinery used in leased buildings.  Therefore, a company that purchases or constructs a commercial building to lease out, will be eligible for enhanced relief on any qualifying fit out expenditure, providing the amendment is passed.

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