Did you know that motors and inverters are included in the government's Energy Technology List?
As such, investing in them from April 2021 could save you tax in the form of the government's 2021 budget 'Super Deduction'. It’s a move meant to stimulate investment, incentivising companies to invest in plant and increase productivity, something much needed since the slowdown in productivity growth.
And it means for every £1 your company invests in new plant, taxes are cut by up to 25p. As a result, the UK's machinery allowances have moved into first place (from 30th!) within the group known as the Organisation for Economic Co-operation and Development (OECD) - a group with 37 member countries, founded in 1961 to stimulate economic progress and world trade. As an example, if a company were to spend £100,000 on new productivity-enhancing plant and machinery, it could deduct £130,000 from its taxable profits. This is a significant saving for companies intending to invest heavily in new equipment.
So, if you’ve been thinking about a new drive or motor buy between 01st April 2021 and 31st March 2023...now would be the perfect time to take advantage of the enhanced tax incentive offered. In effect, you'd be spending without 'taxing' yourself too much.
For more information, see the government website: https://www.gov.uk/guidance/super-deduction