Why is now the time to invest in Machinery & Equipment?
Until March 2023, companies who invest in qualifying new plant and machinery assets can claim 130% super-deduction capital allowance.
Announced back in the March 2021 budget, the idea behind the super-deduction is to encourage UK businesses to invest in productivity-enhancing plant, machinery and equipment to help grow their business.
What does the 130% allowance mean?
The super-deduction is attracting many UK businesses because of its ability to claim 130% of the asset price. This means your company can claim back up to 25p for every pound that’s invested in qualifying machinery and equipment.
There is no expenditure limit however, it is only Limited Companies who qualify and it’s only available on new equipment.
What is qualifying plant and machinery?
The Government’s list of qualifying assets is not limited to the following:
- Solar panels
- Computer equipment and severs
- Tractors, lorries, vans
- Ladders, drills, cranes
- Office chairs and desks
- Electric vehicle charge points
- Refrigeration units
- Compressors
- Foundry equipment
The assets that are excluded are company cars and second- hand plant and machinery.
Can I claim super-deduction if I use asset finance?
Hire purchase contracts qualify under the super-deduction allowance.
This is an advantage to many businesses, instead of purchasing an asset outright, you will be able to make affordable monthly payments over a period of time and retain working capital within the business.
So why invest in machinery and equipment now?
With lockdown restrictions lifting, the UK’s economy growing and businesses reopening, businesses are getting back on track or maybe busier than ever. The construction sector remains above its pre-pandemic peak and the UK housing market has hit an all-time new high.
Whilst at the beginning of the pandemic and during all the country’s lockdowns, many people took the leap and made their hobbies in businesses.
Investing in the machinery and equipment that your business needs will help with the productivity and demand of your business.
Which can lead to opportunities to explore new products or markets and overall help your business to grow.
Plus, the super-deduction allowance is only available for a limited time so it’s a fantastic opportunity to purchase machinery, plant and equipment for your business. If the new asset has a big impact on your business, you may still be able to purchase more under the super deduction. However, if you leave it too late, you may miss your chance.
Speak to the Commercial Finance Specialists
If you’re looking for more information about Hire Purchase finance or would like to get an asset on Hire Purchase, speak to our team of specialists today. As a commercial finance broker, we have access to the whole of the market and with that in mind, we’re confident that we’ll be able to find you the finance solution that you’re looking for.
Call 01270 443510 or complete our enquiry form and a member of our team will be in touch with you as soon as possible.
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