What tax reliefs are available in UK Freeports and Investment Zones?

Full answer

The UK government has designated a network of Freeport and Investment Zone tax sites offering significant tax incentives to attract business investment and employment. **100% First-Year Capital Allowances** Companies investing in qualifying plant and machinery within a Freeport or Investment Zone tax site can claim 100% of the cost as a deduction in the year of purchase. This is on top of the Annual Investment Allowance (AIA) and applies to assets that would not otherwise qualify for full expensing (e.g. integral features, long-life assets). **Enhanced Structures and Buildings Allowance (SBA)** The standard SBA rate is 3% per year over 33 years. Within a Freeport/Investment Zone tax site, the rate is 10% per year — so the full cost is written off in 10 years rather than 33. **Employer NI relief** Employers can pay 0% employer National Insurance contributions on the earnings of new employees (those who were not employed by the same employer within the previous 24 months) who spend at least 60% of their working time in the tax site. The relief applies on earnings up to £25,000 per year and for the first 3 years of employment (extended to 5 years in some zones). Above £25,000, standard employer NI (13.8%) applies. **Stamp Duty Land Tax relief** In England, SDLT relief applies to commercial property and land within designated Freeport tax sites. **Location** Active Freeport tax sites include: East Midlands Airport, Felixstowe and Harwich, Humber, Liverpool City Region, Plymouth and South Devon, Solent, Thames, and Teesside. Investment Zones cover areas like West Midlands, Manchester, South Yorkshire, and others.

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