Finance Act 2024 which received royal assent on 22 February 2024 has removed the March 2026 expiry date and made full expensing (FE) permanent. Although the general exclusion for leased plant and machinery (P&M) still applies to FE the government announced in the Spring Budget 2024 that following a technical consultation it will publish legislation to extend FE to P&M used for leasing.
This is good news for the leasing and asset finance sectors which have been campaigning for this change following the introduction of the previous super deduction (SD).
Overview of full expensing
Most business are likely to be familiar with FE (and its predecessor the SD). However to recap FE is a first-year allowance (FYA) that provides companies incurring capital expenditure on new plant and machinery (P&M) from 1 April 2023 with:
- 100% tax relief for main rate P&M ...
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