JAPANESE KNOTWEED TAX BREAK – A WORKING EXAMPLE

A LIMITED COMPANY UNDERTAKES MODEST QUALIFYING EXPENDITURE OF £100,000 TO HIRE PROFESSIONALS TO CLEAR AN AREA CONTAMINATED BY KNOTWEED.

WHERE A COMPANY IS PROFIT MAKING THIS CREATES A “SUPER-DEDUCTION" OF £150,000 WHICH COULD REDUCE YOUR TAX BILL BY £42,000. THIS MEANS THAT THE NET COST OF THE WORK TO THE COMPANY IS £58,000.

IF YOUR COMPANY IS CURRENTLY MAKING TAX LOSSES, THE SAME £100,000 EXPENDITURE WOULD CREATE A CASH REPAYMENT FROM HM REVENUE & CUSTOMS £24,000.