The Full-Expensing benefit with Asset Finance

‘Full-Expensing’ was the replacement capital allowance tax break for the ‘Super Deduction’…

…brought in by Rishi Sunak in the wake of Covid to incentivise capital investment in businesses when growth post-pandemic had stalled.

Full Expensing

Announced in the 2023 budget, Full-Expensing is a tax incentive to invest in assets and vehicles for businesses, meaning a 100% year-one Capital Allowance of the amount spent on qualifying assets and vehicles can be offset against profit before corporation tax, with no cap on the amount you spend to qualify for tax relief.

With the increase in the corporation tax rate to 25% in that same tax year, this means your clients’ businesses can save 25p in every pound invested in qualifying assets against their corporation tax bill:

• Open to limited companies subject to corporation tax
• Full-Expensing runs for three years from 1st April 2023
• Applies to qualifying NEW assets – always advise clients to confirm with their accountant that the asset qualifies
• Exclusions include company cars, used assets and assets leased to 3rd parties

What are the benefits of Asset Finance?

Clients can use Asset Finance with a Hire Purchase agreement to qualify under the scheme, and additional benefits of doing this include:

• Improving Cash Flow with smaller deposits required
• Tax relief on charges and interest – again, confirm with their accountant is recommended
• Reduced cost of funding for Asset Finance compared to unsecured business lending due to the tangible asset security available to the lender
• Assets leave other business security and guarantees intact – which can be a big positive if the client has a growth strategy to fund

Investing in assets and vehicles can be a tax-efficient way to support a clients business’s growth.

Look at the great lender options available on panel to you with Fiducia Commercial Network to help your clients invest in assets supported by Asset Finance.

About Fiducia Commercial Network

Fiducia Commercial Network is a commercial finance \’Appointed Representative\’ network created to allow independent firms to provide commercial property finance and trading business finance options to their existing client base and network.

Joining the network provides opportunities for professional brokers to offer a full range of commercial finance solutions by acting as an Appointed Representative (AR) with the full support of the Fiducia Commercial Network team.

The Fiducia Commercial Network membership includes FCA authorisation and reporting, PI insurance, and NACFB membership, plus business, compliance, finance, system, and admin support from a company with over 20 years\’ experience in commercial finance.

If you\’d like to discuss joining Fiducia Commercial Network or you\’d like to apply to become an Appointed Representative…

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