According to the Department for Levelling Up, Housing and Communities, the first UK freeports are now “fully up and running after receiving final government approval”. The freeports are in Teesside, Plymouth and Solent.
The government press release states that:
“Each of these Freeports will now receive up to £25 million seed funding and potentially tens of millions of pounds in locally retained business rates to upgrade local infrastructure and stimulate regeneration. …
Freeports benefit from a package of measures, comprising tax reliefs, customs advantages, business rates retention, planning, regeneration, innovation and trade and investment support.
We expect the remaining five English Freeports to join Plymouth, Solent, and Teesside in receiving final approvals shortly.”
Tax benefits for freeports include SDLT reductions and enhanced capital allowances. Details are not given in the press release, but may be summarised as follows:
- For certain expenditure incurred by companies (only) on plant and machinery in freeport areas, 100% first-year allowances are available, subject to various conditions being met.
- For certain expenditure qualifying for structures and buildings allowances (SBAs), accelerated allowances are available (giving relief over 10 years rather than 33.33 years). These enhanced SBAs are available for income tax as well as corporation tax.
- A transaction involving the purchase of land and buildings within a freeport tax site is exempt from charge to SDLT.
https://www.gov.uk/government/news/first-freeports-launched-in-major-economic-boost
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Full reference is made throughout to legislation, case law and HMRC guidance.
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