Claim super deductions on office furniture until April 2023
Did you know that from April 1st this year limited companies that invest in qualifying new plant and machinery assets can claim new super-deductions and allowances? And that it includes office furniture?
Here’s how it breaks down.
- A super-deduction providing allowances of 130% on investment in new office desks and chairs which ordinarily qualify for 18% main rate writing down allowances
- A first year allowance of 50% on investment in new office desks and chairs which ordinarily qualify for 6% special rate writing down allowances
- Companies will not be able to use the super-deduction to buy used equipment
- The super deduction is not available on expenditure in respect of contracts signed before 3 March 2021, even it is not actually incurred until 1 April 201 or later.
How does the super deduction work?
For the majority of office furniture, there will be a super-deduction of 130% of the expenditure incurred. This means that for a spend of £10,000, the corporation tax deduction will be £130,000, giving corporation tax relief at 19% on £13,000, which amounts to £2,470.
Normally such expenditure would either fall within a company’s annual investment allowance and produce relief of only £1,900 or alternatively be tax-relieved at 18 per cent of the cost per annum.
Small and medium sized companies that look to use asset finance to invest in office furniture will need to meet additional conditions to qualify for the super-deduction but it is thought that in most cases such expenditure will still qualify for the relief.
Companies should be aware of the tax impacts that selling the assets in the future could cause and of the types of expenditure that is excluded from being claimable.
What assets can I claim super-deduction on?
As well as office furniture, business can claim on:
- Tractors, lorries, vans (not cars)
- Ladders, drills, cranes
- Computer equipment and servers
- Solar panels
- Electric vehicle charge points
- Refrigeration units
This is not an exhaustive list. There are other assets which can be claimed for too.
As you can see, now is a great time to invest in new office furniture. Talk to Keeley Travis about supplying your new furniture from our extensive, attractive range.