Updates to the energy technology list for capital allowances effective 22 March 2018
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Updates to the energy technology list for capital allowances effective 22 March 2018
Updates to the energy technology list for capital allowances effective 22 March 2018
Thu 01 Mar 2018
SI 2018/268 updates the Energy Technology Criteria list and the Energy Technology Product list to those issued by the Department of Business, Energy and Industrial Strategy on 26 February 2018. The regulation comes into force on 22 March 2018. The list is accessible here.
The list has been amended to include:
- Evaporative air coolers
- Saturated steam to electricity conversions
- White LED lighting modules
The following items have been removed:
- Localised rapid steam generators
- Biomass fired warm air heaters
Qualifying criteria for nine categories of technology have also been amended.
The regulations also specify that first year plant & machinery capital allowances for the combined heat and power plant category are only available if a certificate of energy efficiency is in force with respect to that plant or machinery.
Background
Subject to some general exclusions, expenditure on certain energy saving plant or machinery can qualify for a 100% first year capital allowance in the year of purchase. To qualify, the expenditure must be on plant or machinery that is unused and not second hand and must be included on the energy technology list. Amongst other things, exclusions from first year capital allowances include things like (I) expenditure incurred in a period when the qualifying activity giving entitlement to capital allowances is permanently discontinued, and (ii) expenditure on long life assets.
For a further discussion of the tax issues around capital allowances please get in touch with a member of the Mazars corporate tax team.
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