Super deduction fears

Fraud fears over super deductionRishi Sunak has been warned that the super deduction tax cut announced in the Budget could be used for tax avoidance and fraud, with concerns raised that it could be manipulated by those seeking large tax breaks. The super deduction allows companies to deduct 130% of the value of plant and machinery from profits, with the Chancellor saying that in the two-year window it is active, it will be “the biggest business tax cut in modern British history.” Stuart Adam, senior research economist at the Institute for Fiscal Studies, warned that the scheme will “create a risk of tax avoidance and even potentially fraud” as companies try to find ways to “dress things up” as the investment required to secure the deduction.