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Blog > Super Deduction Tax 

Super Deduction Tax

Super Deduction Tax allowance enables companies investing in new plant and machinery assets, to get a 130% first-year tax allowance - Potentially reducing your practice's tax bill by up to 25%! This government scheme allows you to cut your tax bill by 25p for every £1 spent and is amongst the world's most competitive regimes.

What Is Super Deduction Tax?

Super Deduction Tax provides your practice a much higher tax deduction when investing in qualifying equipment. This first year tax allowance (FYA) is valid within the year the equipment was purchased. This super deduction capital allowance will be available alongside the ongoing Annual Investment Allowance (AIA), which currently provides businesses a 100% tax relief on qualifying purchases of plant and machinery equipment.

This deduction came into effect on April 1st (2021). You have until March 31st (2023), to claim under this government regime. You can only claim this tax relief within the same tax year the equipment was purchased.

The legislation also states that expenditure is ineligible if the purchase contract is entered before March 3rd (2021). Meaning if you entered a contract before this period but did not make payment until after March 3rd, you would be unable to claim. 

Super Deduction Qualifying Assets

Super Deduction Capital Allowances applies to investments which class as NEW plant and machinery equipment. This includes mainly intangible items such as laptops & computers or consulting furniture. This does not apply to intangible items, such as your building (if you needed repairs or improvements).


Some examples of eligible equipment are as follows:

  • Commercial vehicles (i.e vans), but not cars
  • Computer equipment such as desktops and laptops
  • Office and waiting room furniture
  • Consultation and theatre tables
  • Patient warming units
  • Dental and laser units
  • And much more!

How to take advantage of it

Super Deduction will need to be claimed within your company tax return. Your accountant will need to be aware of this allowance and claim it for any qualifying purchases. 





Is there a limit on Super Deduction Expenditure?

Unlike the Annual Investment Allowance (which had a limit of £1m), there is no annual limit on the level of Super Deduction expenditure. Making this a very useful tax deduction for businesses investing in significant plant and equipment.



Anything to watch out for?

This is a first-year tax allowance only - subject to some exclusions. It is only available to those who are subject to corporation tax – typically limited companies. We recommend you liaise with your accountant or financial professional - who will be able to make the relevant checks and can advise you before going ahead with any significant expenditure.