How businesses could save thousands on their tax bill by investing in warehouse automation

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Businesses in the UK are now able to claim 130 per cent of spend on new automated solutions to help cut their tax bill, thanks to a government incentive.

OW Robotics, supplier of flexible warehouse solutions, believes the scheme comes at the perfect time for businesses who are looking to upgrade their warehouse operations and boost their order fulfillment capacity in the face of ever-increasing volumes of online ordering.

The government announced in March that it would be introducing a super-deduction on businesses making investments in qualifying new plant and machinery assets. The idea behind the scheme is to help encourage companies in the UK to invest in productivity and performance boosting solutions to grow their business.

According to government statistics, levels of business investment fell in 2020, with a reduction of 11.6 per cent between Q3 in 2019 and Q3 in 2020, as businesses delayed investment decisions due to the Covid-19 pandemic.

The tax break which came into force on April 1, 2021, will be available on qualifying expenditure up until 31 March 2023. OW Robotics automated warehouse solutions, supporting software and its implementation services all qualify under the government scheme. This includes its goods-to-person, A-to-B and production line solutions.

Joe Daft, Head of Robotics at OW Robotics believes the effects of the pandemic on consumers and businesses going online for their buying needs, has meant companies can no longer delay investing in their warehouse operation to meet the required fulfillment capacity, he said;

“According to a McKinsey report, 20 per cent of people in the UK now shop solely online – the largest portion of any western nation, and this is impacting the purchasing habits of businesses too.

“In reality for businesses, it means they are faced with a real challenge of keeping up with customer demand and expectation. Huge companies like Amazon have set customer’s expectations at fast, efficient ordering and returns. Of course, their level of investment in their operation has been huge but now thanks to more accessible and affordable automated solutions – mid size and smaller businesses have access to automated warehouse solutions like robotics. Which can significantly increase picking rates and picking accuracy and provide ROI within 12-18 months.

“According to research, more than half of businesses anticipate investing in warehouse automation. With the government’s super-deduction incentive, it’s the perfect time for those businesses who may have delayed technology investment decisions in 2020.

“As they look to fuel growth, capitalise on growing online sales and help future proof their business – they can make those investments while making significant tax savings.”

For every pound a business invests in plant and machinery, its taxes can be cut by up to 25p. For more information about the scheme, visit https://www.gov.uk/guidance/super-deduction.

For more information on OW Robotics, visit https://www.owrobotics.co.uk/

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