On 11 March 2020, Financial Secretary to the Treasury, Jesse Norman MP, responded to a written question concerning whether investment in the laying of fibre cables as part of the UK’s broadband rollout will qualify for the Super Deduction on capital expenditure announced in the 2021 Budget.
The Question, asked by Chi Onwurah MP, Labour MP for Newcastle upon Tyne Central, was followed by a second inquiry into the potential effect of the Super Deduction capital allowance on investment in people and skills.
Norman’s full response can be found below:
Broadband: Capital Investment
HM Treasury
11 March 2021
Chi Onwurah (Lab): To ask the Chancellor of the Exchequer, whether investment in the laying of fibre cables as part of the UK’s broadband rollout will qualify for the Super Deduction on capital expenditure announced in Budget 2021.
Chi Onwurah: To ask the Chancellor of the Exchequer, what assessment he has made of the potential effect of the Super Deduction capital allowance introduced in Budget 2021 on investment in people and skills.
Jesse Norman (Financial Secretary): Budget 2021 announced that from 1 April 2021 until 31 March 2023, companies investing in qualifying new plant and machinery assets will benefit from both the 130% super-deduction and a 50% first-year capital allowance. Expenditure on qualifying plant and machinery capital investments used by a company in the course of a trade can qualify for the relevant first-year allowance, including fibre cables. Software can also qualify for the super-deduction, provided the company makes an election to remove software from the intangible fixed assets regime. Expenditure on the learning and development of staff does not qualify for the super-deduction but is already an allowable expense for tax purposes.