Nudge letters target super-deduction claims

HMRC’s has contacted a small number of companies in relation to their super-deduction claims. The tax authority has told the CIOT that it has sent two different letters one on lease restrictions and one to companies whose accounting period straddles 1 April 2021.

On leasing restrictions HMRC’s letter highlights the condition that spending on plant or machinery does not qualify for the super-deduction if it is bought to lease or to hire to someone else.

For companies whose accounting period straddles 1 April 2021 HMRC is asking them to check the date when the business entered into the contract to buy the plant or machinery. The letter reminds companies that the super-deduction is not available if the company entered into a contract to buy the plant and machinery before 3 March 2021.

The letters have been copied to the taxpayer’s authorised agent if...