Government Allowances on Solar Panels

From April 2021, companies can claim up to 130% of their Capital Allowances back from the Government, for qualifying investments. The list includes both Solar PV as well as EV Charge Points.

Under the scheme, for every pound invested, the company can save up to 25p on taxes. This kind of saving is hoped to be a win-win, as companies save whilst improving their business. The list of qualifying items is presented below:

• Solar panels

• Electric vehicle charge points

• Computer equipment and servers

• Tractors, lorries, vans

• Ladders, drills, cranes

• Office chairs and desks

• Refrigeration units

• Compressors

• Foundry equipment

From 1 April 2021 until 31 March 2023, companies investing in qualifying new plant and machinery assets will be able to claim:

• a 130% super-deduction capital allowance on qualifying plant and machinery investments

• a 50% first-year allowance for qualifying special rate assets

The super-deduction will allow companies to cut their tax bill by up to 25p for every £1 they invest, ensuring the UK capital allowances regime is amongst the world’s most competitive.

The government has offered unprecedented support for businesses during Covid. Even so, pandemic-related economic shocks and the accompanying uncertainty have chilled business investment. This super-deduction will encourage firms to invest in productivity-enhancing plant and machinery assets that will help them grow, and to make those investments now.

Learn more about the scheme, the first wave of information is available here: www.gov.uk/guidance/super-deduction

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