If you are incorporated and considering buying new plant and machinery imminently you should consider delaying incurring expenditure until after 31 March 2021. From 1 April 2021 until 31 March 2023, companies investing in qualifying new (not used or second-hand) plant and machinery assets will be able to claim a 130% super-deduction capital allowance on qualifying plant and machinery investments.
The super-deduction will allow companies to cut their tax bill by up to 25p for every £1 they invest but there are additional qualifying conditions for hire purchase assets.
Timing will be crucial so you need to understand when expenditure is incurred for capital allowances. The normal rule is expenditure is incurred on the date on which the obligation to pay becomes unconditional. In most cases expenditure is incurred when the goods are delivered but there is a special rule where there is a gap of more than four months between date obligation to pay becomes unconditional and date payment is required to be made.
As always you should speak with an adviser to ensure you understand your tax position.
