Skip to: main navigation | main content | sitemap | accessibility page


1st April 2021 - Super deduction kicks in: Claim 130% capital allowances on qualifying plant and machinery investments.​

Been thinking about automating but not been ready to take that leap of faith?

With super deduction tax on main rate new plant and machinery kicking off tomorrow, now is the time to stop thinking and start doing.  

Super deduction will allow you to cut your tax bill by: 

  • up to 25p for every £1 invested, providing a 130% allowance on qualifying assets that would normally qualify for a mere 18% write down.

  • a first-year allowance of 50% on qualifying special rate assets that would ordinarily qualify for a 6% relief. 

Taking advantage of this generous capital allowance measure will mean that you will be able to write off the costs of tangible capital assets in your robotic automation project against your taxable income.  

In addition, if you are spending money on developing new, or improving existing processes, products or services, you may well be eligible for Research and Development (R&D) tax relief.  

Money spent on innovation may qualify for a R&D tax credit claim, which can be received either through a cash payment or a reduction in Corporation Tax but for non-exempt SME’s, this will be capped at £20k plus 300% total PAYE and National Insurance Contributions (NIC) liability. 

For larger companies undertaking R&D projects and SMEs subcontracted by a larger company to do R&D work (or received a grant or subsidy for their project), R&D Expenditure Credit (RDEC) may be claimed. The taxable credit is calculated at 13% of your company’s qualifying R&D expenditure. 

Typical R&D project costs that can be claimed include: 

  • staff pay and employer Class 1 NIC and pension fund contributions. 

  • consumable materials and utilities e.g., energy and water; and  

  • software. 

Simon Neath, Financial Director

Simon Neath, Financial Director at Active8 Robots, recommends:

Do not forget that R&D also includes time spent assessing the technical feasibility of a project, researching potential solutions, planning, Q&A testing, engineering work amongst other factors. 

On the whole, the UK manufacturing sector has been pitifully slow to adopt new technologies. We shamefully lag so far behind that we did not even make it to the list of 21 most automated countries according to the latest World Robotics statistics, issued by the International Federation of Robotics (#IFR). We can no longer afford to be losers in the race to become a technology superpowerIndustry needs to improve productivity and investing in automation can help achieve this. 

So, if you have been thinking about automating outdated manual production processes, now presents the ideal opportunity to bring your planned automation investments forward. Let us not stagnateLet us innovate and automate. 

Remember, the super deduction incentive is only a temporary measure ending 31 March 2023. Two years will soon fly by.  

The journey is ON. 
Let’s GO!

Contact one of our consultants today to talk about your automation needs, objectives and capabilities. 
Email [email protected] or call us on 01761 234 376.