A tax incentive launched during the pandemic could save you thousands on the purchase of a new coach.
The Super-deduction tax incentive, designed to stimulate business investment started on 1April 2021 but finishes on 31 March 2023, so you have a few months to make it work for you. For every £ you spend, it can offset 130% of the value against taxable profit. In effect this cuts taxes by 25p for every pound spent.
For a £250,000 coach bought with the scheme, this represents a saving of £61,750 on your corporation tax. But think big with investment; there is no upper limit for Super-deduction, and assets purchased through hire purchase also qualify.
Super-deduction only includes NEW vehicles – and other equipment, of course – but if you are thinking of buying a used vehicles the Government also extended the £1m Annual Investment Allowance (AIA) until 31 March 2023, and that incorporates used assets. This provides 100% tax relief.
For the government guidance, go to www.gov.uk/guidance/super-deduction