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The move to permanent full expensing

The move to permanent full expensing marks a change in UK corporate tax strategy, writes Jasmine Kaur, Head of Capital Allowances at HM Treasury.

Why now?

It has been an exciting few years in the world of capital allowances.

Spring Budget 2021 saw a change of approach from a 19% corporation tax rate and standard capital allowances to a higher headline rate and a new 130% super-deduction to encourage companies to invest in the immediate aftermath of the pandemic.

Spring Statement 2022 marked the start of a consultation on five different options for the future of capital allowances following the super-deduction.

Spring Statement 2023 then confirmed full expensing as the clear winner and successor to the super-deduction in place on a temporary basis but with a commitment that it would be made permanent as soon as fiscal conditions allowed.

And finally in what...

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