The Budget Announcement 2021

Reduce your tax bill by 130%

During the 2021 Budget on 3rd March, chancellor Rishi Sunak announced that for the next two years, when companies invest, they can reduce their tax bill by 130% of the cost. This 'super deduction' will help support companies and businesses through the end of the coronavirus pandemic.

‘With the lowest corporation tax in the G7 and a new small profits rate, the UK will have a pro-business tax regime, but we need to do even more to encourage businesses to invest right now.

‘Business investment creates jobs, lifts growth, spurs innovation and drives productivity. For decades we have lagged behind our international peers. Right now, while many businesses are struggling, others have been able to build up significant cash reserves.’

‘We need to unlock that investment. Today, I can announce the super deduction. For the next two years, when companies invest, they can reduce their tax bill not just by a proportion of the cost of that investment as they do now, or even by 100% of their cost, the so-called full expensing some have called for, with the super deduction they can now reduce their tax bill by 130% of the cost.

‘This will be the biggest business tax cut in British history.’

Examples of ‘super deduction’ in practice:

Example One

    • A company incurring £1m of qualifying expenditure decides to claim the super-deduction 
    • Spending £1m on qualifying investments will mean the company can deduct £1.3m (130% of the initial investment) in computing its taxable profits 
    • Deducting £1.3m from taxable profits will save the company up to 19% of that – or £247,000 – on its corporation tax bill.

Example Two

Previous system 
  • A company spends £10m on qualifying assets 
  • Deducts £1m using the AIA in year 1, leaving £9m 
  • Deducts £1.62m using WDAs at 18% 
  • Deductions total £2.62m – and a tax saving of 19% x £2.62m = £497,800 
With ‘super deduction’ 
  • The same company spends £10m on qualifying assets 
  • Deducts £13m using the superdeduction in year 1 
  • Receives a tax saving of 19% x £13m = £2.47m 

But what does this mean for your business?

 This means that your business can claim 130% relief on tax for any machine and/or sever purchases, and this can be claimed between 1st April 2021 to 31st March 2023. 

Invest in your computer equipment and servers to: 

  • Strengthen the IT and technology within your business to ensure business productivity and continuity throughout 2021 
  • Improve your employees’ experience working from home by investing in remote working technology, such as laptops 
  • Invest in upgraded server technology that will improve business productivity and efficiency

Still using Windows 7 machines?

If your business is still using Windows 7 machines that require urgent replacement due to them no longer receiving security updates and being unsupported by Microsoft, it’s really worth thinking about replacing your machines sooner rather than later. 

We want to help our customers avoid their systems becoming vulnerable to attack, so are currently offering a customer exclusive offer for half-price installation on all laptops / PCs replacing Windows 7 machines throughout March 2021* 

With 130% tax relief and half-price implementation until the end of March, now is the perfect time for our customers to invest in their business and purchase new hardware to replace their older, unsupported machines. This will allow them to benefit from the same high-quality hardware at a lower cost, which is great for their company budget. 

It’s worth noting that our costive exclusive half-price implementation offer will not be continued after the end of March 2021, so if you would like us to provide a quotationincluding the labour discount, we’d advise that you get in touch as soon as possible. 

Give us a call on 0800 001 4148 or email us at [email protected].  

*Customer exclusive offer. Half-price installation offer ends on Wednesday 31st March at 11:59pm. This offer is for initial laptop / PC installation costs only. Half-price installation is only applicable to laptops / PCs that are replacing Windows 7 machines currently in use. Installation must be booked before the end of April 2021. Additional T&Cs apply - ask our team for full details.

Looking to invest in technology?

If you’d like to speak with our IT support experts at Custard and find out more about how investing in the IT and technology within your business can ensure business productivity and continuity throughout 2021, give us a call on 0800 001 4148 or email us at [email protected]. 

About Custard

We’re technicians, engineers, salespeople, number crunchers and directors (but above all, we’re a bunch of geeky gurus).

We’ve got over two decades of experience in the IT industry, delivering friendly jargon-free IT support and services for businesses across the East Midlands and the UK. We are a fast-growing company that supports businesses across many different sectors, from manufacturing companies to charities. Whether your company needs help with IT infrastructure, flexible and reliable hardware or expert technical consultancy – we offer tailor-made IT support solutions to help your business continue to grow and thrive in this modern world.

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Custard Careers

We work to create a company culture that sustains a motivated workforce and encourages personal development to ensure our team thrive. Our employees are given opportunities to develop and learn new skills, attend team building events and are awarded for their dedication.

Our team is made up of friendly IT support professionals whose focus is always based on the customer experience and providing excellent service – and we're always looking for talented people to join the Custard team. Click the link below to see our current vacancies.