Autumun Statement 2023

In the Autumn Statement of 2023, the Government extended and made permanent the full expensing scheme, effective since April 2023. This bold fiscal measure aims to boost business productivity, growth, and investment by offering up to 100% first-year allowance on qualifying plant and machinery purchases. We provide updated guidance on how full expensing works and its benefits to British businesses.

Full expensing replaces the previous Super Deduction, offering a 100% allowance compared to the Super Deduction's unlimited 130% allowance. This policy incentivizes businesses to invest in capital assets for growth, providing immediate tax relief and fostering productivity and efficiency.

From Super Deduction to Full Expensing

Under full expensing, companies can deduct 100% of the cost of qualifying capital investments, improving cash flow and facilitating reinvestment. This tax relief is applicable to all sizes and sectors of UK corporation tax-paying businesses.

The scheme provides immediate tax benefits, fostering heightened productivity, efficiency, and job creation. Businesses should prioritize the Annual Investment Allowance (AIA), providing 100% relief for plant and machinery investments up to £1 million.

Growth and Investment

The extension and permanence of full expensing present strategic opportunities for businesses, allowing for medium to longer-term planning of capital expenditure and fostering sustained economic growth and investment. The Chancellor's commitment to extending the full expensing period reflects the government's responsiveness to industry needs, creating an environment conducive to business growth.