Super-deductions - HMRC to issue One-to-Many Letters

From the 1st of April 2021, until 31st March 2023, HMRC introduced a super-deduction to companies, and enhanced capital allowances, for qualifying plant and machinery assets.

• 130% was available on main pool assets;
• 50% was available on special rate assets.

HMRC have recently launched a ‘One-to-Many’ approach in respect of the super-deduction. This approach is where HMRC send one standard message to many customers.  The aim is to influence customers’ behaviour, so they are more likely to comply with their tax obligations. A One-to-Many approach is not a compliance check.

Two letters will be issued, one to companies in relation to lease restrictions, providing guidance and support in relation to the rules for the company. The letter will request where the company has applied the super-deduction incorrectly that they amend their company tax return.

The second letter relates to companies whose accounting period straddles 1st April 2021. HMRC is requesting companies check the date on which a contract to buy plant and machinery was entered into, as well as offering guidance for super-deduction claims. The letter will request where the company has applied the super-deduction incorrectly that they amend their company tax return.

If you receive a One-to-Many letter and require our assistance, please get in touch with our tax experts at js.tax@jsllp.co.uk, who will be happy to assist.