The new super-deduction tax relief for fleets investing in new vans and trucks announced in 2021 is set to end March 31, 2023!
As you may know, if your business is VAT registered you can reclaim 100% of the VAT for any commercial vehicle you purchase or lease. This figure may be higher if you claim the super-deduction tax relief for new vans and trucks that was announced in 2021. You may want to hurry though, as this extra relief is set to end March 31, 2023!
The good news is that Vospers have over 100 vehicles that qualify for this incentive which are able to be registered and delivered before the deadline. The savings are on top of any deal that we can offer you including many vehicles with 0% APR; and even if it’s a bit soon for you, the part exchange value of your current vehicle may tip the balance!
Tax Relief Allowance
The tax relief allows companies to claim a 130% super-deduction capital allowance, or a 50% first-year allowance (FYA). This is for qualifying special rate assets on new commercial fleet vehicles. Expenditure qualifying for the super-deduction is typically relieved at the main rate writing down allowance of 18%. The special rate writing down allowance was 6%. The savings for your business could be huge if you are accepted.
What Vehicles Does the Tax Relief Apply To?
The tax relief applies to both heavy and light commercial vehicles. This is if they meet the conditions of being brand new and unused. Company cars, however, are not treated as ‘main pool’ plant and machinery for capital allowance purposes. As such they do not qualify. You must be a limited company buying new equipment using a method of finance that means you obtain outright ownership.
Benefits of The Tax Relief
This tax relief will allow companies to cut their tax bill by up to 25p for every £1 they invest. This represents a major opportunity for companies to upgrade their vans and other commercial vehicles. It also means that electric and hybrid vehicles can be a more affordable option for commercial fleets. These vehicles are often much more expensive than petrol and diesel. But, thanks to the super-deduction, the cost of acquisition is suddenly much more achievable. This has numerous benefits for the environmental impact that businesses have in terms of pollution created via their logistical operations.
The tax relief allows companies to claim a 130% super-deduction capital allowance, or a 50% first-year allowance is set to end March 31, 2023. It applies to both heavy and light commercial vehicles. It also allows companies to cut their tax bill by up to 25p for every £1 they invest. As well as this it means that electric and hybrid vehicles can be more affordable for commercial use having positive effects on the environment.
If you are looking to upgrade your commercial vehicle(s), be sure to check out our range of new vans and commercial vehicles as well as our current offers. You are also welcome to visit us in-store at our Vospers Van Centres in Exeter, Plymouth or Truro. To seek more advise surrounding this incentive the full details are on the Government website.