There are lots of advantages to revitalising your office environment, from improving the wellbeing of staff to helping to facilitate better collaboration and communication. In fact, it’s a great way to make the most of the fresh start of a new year. But what does that have to do with the super-deduction tax? Office furniture is actually considered a tangible business asset, which means it is included in the super-deduction tax allowance – and that can make an office refresh much more affordable and within reach.

How does it work?

The benefits of the super-deduction tax were introduced in 2021 as a temporary change to tax relief. This change allows companies to claim enhanced capital allowances on qualifying plant machinery and assets. That category includes office furniture, such as office desks and chairs. The way that the super-deduction tax works is to offer a discount against a company’s tax bill for the investment that is made in qualifying plant machinery and assets. That discount looks like a reduction in the tax bill of £24.70 for every £100 spent on office furniture. So, in effect, the more the business spends on office furniture (or other qualifying assets), the bigger the tax reduction is likely to be. This is why it’s such a great time to refresh an office environment – and take advantage of the super-deduction tax before it ends in April. Here’s a simple example: a company incurs £100,000 of qualifying investment and claims the tax relief. This will mean that the company can deduct £130,000 (130% of the initial investment) when calculating taxable profits at the end of the year.

Why is there a time limit?

The super-deduction tax was only ever meant to be temporary tax relief, designed to help businesses and offices through the period of recovery post-covid. So, it’s going to come to an end in April 2023. That makes this the ideal time to invest in your office environment, not just because there are many benefits to doing this but also because it will have a positive impact on the business’ tax burden too.

3 reasons why 2023 is the ideal time for an office refresh

• New year, new start. The beginning of a new year is often when we feel revitalised to set new goals and be more ambitious and productive. A fresh new office environment can support this.
• Accommodating different working models. An office refresh for your business might be more about switching to more agile working or collaborative spaces – the super-deduction tax is a great incentive to make that happen now.
• Sending the message to employees that they are valued. New installations and office furniture, a refurbishment of interiors and even a fresh colour scheme that matches new branding all send the message to employees that their day-to-day experience and comfort are valued by the business.

The benefits of the super-deduction tax come to an end in April so now is the ideal time to plan a refresh for your office environment to take advantage of this. For guidance on what qualifies for the 130% tax break please contact us