Last month’s Autumn Statement saw the Chancellor of the Exchequer Jeremy Hunt announce a number of measures to raise business investment, get more people into work, reduce inflation next year and increase GDP.
One of the measures outlined was to make the previously introduced business ‘full expensing’ scheme permanent, enabling businesses to write off the entire cost of spending on new machinery and equipment, while saving on other investment types. In addition, £4.5 billion of funding has been promised to attract investment into strategic manufacturing sectors over the next five years.
‘Full expensing’ explained
The Government introduced “full expensing” to encourage UK companies to invest in more modern plant, tools and machinery, vehicles and technology. By making it permanent, it allows UK companies to deduct 100% of the cost of new plant and machinery from their taxable profits in the year of purchase.
Do you have the correct cover in place?
Now is the time to review your plant and machinery equipment coverage, and make sure that your policy protects you against the correct value of your equipment. Contractors policies can offer cover that takes into account depreciation (with an adjustment made for wear and tear), and also protection on a “new for old “basis. It’s essential that you seek advice from your broker to ensure that you safeguard your business, and that your insurance cover is arranged appropriately.
Risk management should also be discussed with your broker, in particular a review of site security and larger items of plant and machinery having tracking and telematic devices, immobilisers, or being registered with a scheme.
Don’t forget about transit
As well as protecting the plant and equipment on site, your policy needs to allow for transit to and from sites and allow for temporary removal and storage.
If an item of plant is subject to Road Traffic Act regulations when being used, then your motor fleet insurer also needs to be aware, as this cover will be excluded from a Contractors All Risks policy. Protection can be secured for damage caused to other parties (for example mobile equipment using the highway when exiting/entering site or driving on roads forming part of a completed phase of works) but also where available to protect against damage to the item of plant itself from a road traffic accident.
Protection is also available against plant that is accidentally immobilised/immovable and can be extended to include breakdown and other risks that are offered by an Engineering policy.