The HMRC website now includes an online tool to check whether you can claim super-deduction or special rate first year allowances for qualifying plant and machinery purchases.
Check if you can claim super-deduction or special rate first year allowances - GOV.UK (www.gov.uk)
The link asks a series of questions about the company, the accounting period and the asset purchased, including:
- Is the company within charge to Corporation tax?
- What is start date of the accounting period?
- What is the end date of the accounting period?
- Has the company incurred capital expenditure on providing plant or machinery?
- What is the asset?
- What is the company name?
- Did the company enter into a contract for the expenditure before 3 March 2021?
- Did the company own the asset at any time during the accounting period?
- What date is the expenditure treated as incurred?
- Is the asset new and unused?
- What business activity was the asset obtained for?
- Is the asset a car?
- Do any of the other general exclusions apply?
- Was the expenditure on an integral feature of a building?
The user must work through the questions selecting the answer most appropriate from those available. The answers given are used to provide a decision on whether super deduction or first year allowance will be available.
The tool is anonymous with no personal details saved by HMRC.
It is not possible to save information entered into the link – the answers must all be completed in one session and the session may be timed out as a result of inactivity.
The tool aims to help Company’s understand if the expenditure qualifies for the super-deduction or special rate first-year allowance. It’s aim is to help users understand:
- If the expenditure qualifies for the super-deduction or special rate first-year allowance
- How much relief they may be entitled to
The tool does not cover every eventuality and before making a claim, the user must check that:
- The purchase meets the definition of plant and machinery
- They comply with all the rules for these reliefs
- That their claim has been worked out correctly
Plant and machinery are tools of the trade, kept permanently for the use of the business. What counts as plant and machinery will depend on the nature of the nature of your business.
The HMRC tool has links to factsheets which includes definitions of plant and machinery and these confirm most tangible capital assets used in the course of a business are considered plant and machinery for the purposes of claiming capital allowances.
There is no exhaustive list of plant and machinery assets. The kinds of assets which may qualify for either the super-deduction or the 50% FYA include, but are not limited to:
- Solar panels
- Computer equipment and servers
- Tractors, lorries, vans
- Ladders, drills, cranes
- Office chairs and desks
- Electric vehicle charge points
- Refrigeration units
- Compressors
- Foundry equipment
The next step
If you require professional guidance on capital allowances, super deduction or first year allowances, please contact Alison Price or your usual UHY adviser.
