Super-deduction replaced by full expensing

After the cessation of the super-deduction capital allowance earlier this year companies will have access to a new first year allowance (FYA) referred to as ‘full expensing’ that allows them to claim a 100% deduction for tax purposes in the year of spend on specific capital investments.

This relief is temporary and will end on 31 March 2026 but for companies that take advantage of it it will enable up to £250 of each £1 000 of capital spend to be recovered against their tax bill and so potentially significant tax savings are available.

What is full expensing?

The relief will enable companies (particularly those with significant spend) to obtain a taxable deduction on qualifying expenditure in the year of acquisition rather than it being relieved over several years.

Plant and machinery full expensing

Eligible companies will benefit from a 100% first...