Are you in the know about Enhanced Capital Allowances?

Ellen Webster, Paul Robinson Partnership (uk) LLP

To encourage businesses to make the investment in monitoring technology and energy saving, Enhanced Capital Allowances (ECAs) are available meaning that 100% of the qualifying capital expenditure may be claimed back against taxable profits in the first year.

There are three schemes for ECA’s which are energy saving plant and machinery, water conservation plant and machinery, and low carbon dioxide emission cars and natural gas and hydrogen refuelling infrastructure. Focussing on water conservation, did you know if you fit efficient showers, taps, toilets, washing machines, detection and monitoring equipment and the product is suitable you can use the ECA Scheme.

Taking it further, installing rainwater harvesting equipment, smaller scale sludge dewatering equipment, water efficient industrial cleaning equipment amongst many others, you can again use the scheme.

The general rate of capital allowances is 18% a year on a reducing balance basis up to a limit of £25k.  Some technologies supported by the ECA Scheme (e.g. boilers, lighting) are included in a special capital allowances pool where the general rate of capital allowances is 8%. Additional benefits of purchasing ECA qualifying energy efficient technologies could include: improved cash flow, lower energy bills, reduction in Climate Change Levy or CRC payment.

We will look into all of these options as part of any project we work on and to the Clients needs and specifications.

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