HMRC advise that, where possible, they would prefer companies to wait until the new boxes for these claims are available on the CT600. As an interim measure, for companies that need to file before 1 April 2022, HMRC approve the use of box 725 or box 750 for such claims. This article offers appropriate workarounds that can be used until Sage Corporation Tax has been further updated.

CAUTION: If you are applying super deductions, you should first download and apply the new update, read more >

If you use the workarounds, please be aware that:

• You will have to amend your data when updated software is released that features the new boxes.
• The workarounds will only deal with the acquisition of assets on which either a super-deduction or SR allowance is claimed. The workarounds will not work where the disposal of such assets occurs.
• The workarounds will only deal with acquisitions of such assets in accounting periods that do not straddle 1 April 2023, although this is unlikely to be an issue.

Workaround 1 - Expenditure on which a super-deduction is claimed

A super-deduction of up to 130% is available on qualifying expenditure (super-deduction expenditure) on a main rate pool asset. Qualifying expenditure means it is incurred between 1 April 2021 and 31 March 2023 inclusive on new and unused plant or machinery and which is not precluded by any of the general exclusions in CAA 2001, s46(2).

In the Fixed asset register, enter the asset in the normal way but use the following guidance for the boxes referred to below:

Cost	To claim the super-deduction, multiply the qualifying expenditure by 130%,  For example, where an asset cost £100,000 and no grants were provided, enter £130,000.
Type	Select Main rate assets pool (or Short life asset, if relevant and applicable).
Qualifies for	Select FYA - Other  TIP: ignore the help tip for the purpose of this workaround.

NOTE: 

• If you're claiming Annual Investment Allowance (AIA) on any of the total expenditure on the asset, add a separate asset in the fixed asset register to claim AIA on that expenditure and just enter the expenditure on which no AIA (or any other allowance) is claimed (multiplied by 130%).
• For example, if the asset cost £120,000 of which £20,000 was grant-funded, enter £150,000 (£100,000 x 130% plus £20,000).
• The NBV Reconciliation screen will need an adjustment to take out the total amount by which the Net cost has been grossed up. If no grants are provided, the adjustment will be a reduction of the difference between the grossed up Net cost and the actual cost. In the above example, the reduction would be £30,000 so enter -£30,000 in one of the boxes just above Total additions.

Result

Assuming no other assets are acquired in the period and no other capital allowances are claimed, the business activity will have capital allowances of £130,000 and CT600 will show £130,000 in either box 725 or box 750.

Workaround 2 - Expenditure on which the SR allowance is claimed

The SR allowance is a FYA of 50% and is available on qualifying expenditure (SR allowance expenditure) on a special rate pool asset. Qualifying expenditure means it is incurred between 1 April 2021 and 31 March 2023 inclusive on new and unused plant or machinery and which is not precluded by any of the general exclusions in CAA 2001, s46(2).

In the Fixed asset register, enter the asset in the normal way but use the following guidance for the boxes referred to below:

Cost	Enter the actual expenditure.
Type	Select one of the Special rate assets pool options, choosing the one that is applicable to the asset concerned.
Qualifies for	Select FYA - Other  TIP: ignore the help tip for the purpose of this workaround.

NOTE: If you're claiming Annual Investment Allowance (AIA) on any of the total expenditure on the asset, add a separate asset in the fixed asset register to claim AIA on that expenditure and just enter the expenditure on which no AIA (or any other allowance) is claimed.

In the Additions qualifying for FYA section of Special rate assets pool for the business activity to which the asset is allocated, in the Not claimed box for FYA - Other, enter 50% of the cost of each asset on which the SR allowance is claimed.

Example 1: For an asset that cost £250,000 (with no grant provided), enter £125,000 (50% x £250.000).

Example 2: As well as the asset in example above, a second asset on which the SR allowance is claimed costing £40,000 (no grant provided) is used in the same business activity. In the Not claimed box for FYA – Other, enter £145,000 (50% x (£250,000 + £40,000)).

Results

Example 1: £125,000 and which will be shown in the CT600 in either box 725 or box 750.

Example 2: £145,000 and which will be shown in the CT600 in either box 725 or box 750.