Budget Super Deduction

[mf7480]

There's a sting in the tail! When you come to sell it 130% of sale value goes onto profits.

 

[Billboy1]

is that correct ?

 

[Clive]

is this definitely ltd only then ?

 

[Clive]

is that correct ?

sadly yes - bugger on machinery (bit of a tax trap really). but no problem on buildings etc that wont get sold

 

[The Arable Farmer]

sadly yes - bugger on machinery (bit of a tax trap really). but no problem on buildings etc that wont get sold

I think Ltd only.... farm buildings aren't plant and machinery unless theres a new exemption?

 

[Clive]

I think Ltd only.... farm buildings aren't plant and machinery unless theres a new exemption?

didn’t realise this new super deduction was just plant and machinery ? had the impression it was any investment

no use if its only ltd’s to me though anyway

 

[farmerdan7618]

didn’t realise this new super deduction was just plant and machinery ? had the impression it was any investment

no use if its only ltd’s to me though anyway

It's worse than only plant and machinery, it needs to be 'new' plant and machinery, so not available on second hand kit.

And yes, ltd's only, and unwinds when the equipment is sold.

 

[yellow belly]

It's worse than only plant and machinery, it needs to be 'new' plant and machinery, so not available on second hand kit.

And yes, ltd's only, and unwinds when the equipment is sold.

At least the government are switched on to see the some of dodges befor they happen
Do they have a few business people in their party

 

[farmerm]

as things stand after 2019s cropping disaster I probably

Self employed Tax not changed but has the relief changed if you pay in to pension?

Dont think it has?

ie pay £80 in to pension gov top it up by £20
Then if your a higher rate tax payer paying 40% tax accountant can claim another 20% off your tax for anything you put in pension.

I dont have a pension yet still but know I really should

I put a couple of quid in mine yesterday morning just incase they did drop pension tax relief every little helps I guess

 

[Johnnyboxer]

Something different, if it applies to farming businesses there’ll be a lot ‘investing‘ in the next two years and not much profit being made! Spend £100k and get £130k tax allowance! I can see some manufacturers getting exciting and adjusting their prices accordingly.

Only for Ltd Co's................... not Sole Traders and Partnerships, I thought

 

[Johnnyboxer]

is this definitely ltd only then ?

YES

 

[B R C]

Not so good then, what % of farms are ltd?

 

[Kidds]

Not so good then, what % of farms are ltd?

100% of mine.
Won't matter to me as can't see there being any tax to pay anyway. Flip side to this is there has been no financial assistance to directors of single operator Ltd companies, no furlough, grants etc. Rishi even said so this evening

 

[ACEngineering]

as things stand after 2019s cropping disaster I probably


I put a couple of quid in mine yesterday morning just incase they did drop pension tax relief every little helps I guess

yeah they did change it, so i'm looking to start a pension before the end of this month now. speaking to someone tomorrow but the advisers fees look horrific compared to Penfold, i get penfold one may not do as well as with a good investor/adviser but i cant see that it will that much worse to justify the fees of the other one. i like the penfold idea were i'm more in control

 

[Johnnyboxer]

Not so good then, what % of farms are ltd?

Why aren’t more farms Ltd Co’s

Good way to shelter their assets

 

[farmerm]

yeah they did change it, so i'm looking to start a pension before the end of this month now. speaking to someone tomorrow but the advisers fees look horrific compared to Penfold, i get penfold one may not do as well as with a good investor/adviser but i cant see that it will that much worse to justify the fees of the other one. i like the penfold idea were i'm more in control

what did they change? pension tax relief remains unchanged for ever 2K you put in a pension government add another £500 if a higher rate tax payer you can claim more

 

[ACEngineering]

what did they change? pension tax relief remains unchanged for ever 2K you put in a pension government add another £500 if a higher rate tax payer you can claim more

sorry stupid auto correct, i meant didn't

 

[ACEngineering]

what did they change? pension tax relief remains unchanged for ever 2K you put in a pension government add another £500 if a higher rate tax payer you can claim more

i think its more than 2k your allowed to put in? max depends what you earn i think but could be up to 40k per year i think and still get the gov top up? its all new to me so learning as i go along.

 

[Ormond]

The extra is to get companies to invest in the next 2 year
or they could wait till the higher rate tax comes in and then invest

ie now at 19% tax so spend 100 and get 130 tax allowance on 19
or wait 2 years tax rate at 25 % spend 100 and get tax allowance 100 on 25

That all depends if your profit is £250,000 or more after April 2023 as then the corporation tax is on a sliding scale from £50,000 to £250,000....
The later and above will be on 25%......£50,000 and below still on 19%. Something to consider regarding the super deduction......

 

[farmerm]

i think its more than 2k your allowed to put in? max depends what you earn i think but could be up to 40k per year i think and still get the gov top up? its all new to me so learning as i go along.

That is correct I think you can pay in each year up to 100% of earning or £40K whichever is greater Government pays in 20% on top of your contribution, ie they give you back the income tax you have paid on earning that money.. I think the £40K limit includes the governments 20% so I think the maximum you should pay in is £32K (+20% from the gov makes £40K), if you exceed £40K contributions it get taxed at your highest tax rate If you are self employed, pay into a personal pension and lucky enough to pay higher rate tax, pension contributions should be recorded in your self assessment and you can claim the other 20 or 25% relief in the form of a deduction from your tax bill?