TECHNICAL FEATURE
New Tax Relief for Drainage
Contractors buying new or HP Vans Jason Ahmet and Chris McCauley, Capital Fleet Solutions
The Government has announced that there is a new temporary taxrelief on some qualifying investments from 1 April 2021. And the even better news is that this enhanced allowance does apply to new vans and all the new equipment, which could be up to £75,000 + Vat for a fully fitted drainage van.
You have to be: ■ Within the charge to Corporation Tax
■ A company – sadly this doesn’t cover Sole Traders or Partnerships
■ Not leasing – which is why the relief is only available for Hire Purchase or
Buying Outright options
■ Looking to get a new, unused van – second hand vans don’t count
■ Investing in ‘plant and machinery’ on or after 1 April 2021
So, if you’re considering purchasing a vans and equipment between now and March 2023, you can claim:
1) A ‘super-deduction’, providing allowances of 130% on most new plant and machinery investments that ordinarily qualify for 18% main rate writing down allowances
2) A first year allowance of 50% on most new plant and machinery investments that would normally qualify for 6% special rate writing down allowances
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What does this mean in practice? Here’s an example:
Your company wishes to buy a drainage van package, including new van, flooring, shelving and jetter for £50,000.
•
If you bought this before the changes (before 1 April 2021), you could claim a deduction of £50,000, resulting in a tax saving of £9,500
•
If bought on or after 1 April 2021, your company could claim a deduction of £65,000, resulting in a tax saving of £12,350
To conclude, it’s definitely worth talking to us and your accountant about this issue if you’re thinking of buying a new van set up. We can help you get on the road and delivering for your drainage company.
The importance of Hygiene in above ground Drainage Pipes
In these unprecedented times when we are being asked to be particularly vigilant in our hygiene habits, what about the pipes that transport our fluids and waste away?
Modern plumbing systems have measures in place to protect buildings from sewer gas leakage. Incorrect installation or failure of these measures can lead to escape of sewer gases into the building. In addition, when a defect occurs in the sanitary plumbing system that affects the system integrity, a
| July 2021 |
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cross-transmission route is created that can enable the emission of bio-aerosols from the system into the building. So, what steps should we be taking to ensure our pipework is as safe as possible? And what are the health risks if our above ground (AG) drainage systems fail?
Regulations are already in place to protect us. They include Approved Document H of the Building Regulations, and BS EN 12056 to protect against failures in drainage systems by setting the gradient
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