What was the super-deduction at FA 2021 s.9 and when did it apply?

The super-deduction was a 130 per cent first-year allowance on qualifying main-rate plant-and-machinery expenditure by companies within the charge to corporation tax. The companion SR (special-rate) allowance at FA 2021 s.9(3) gave a 50 per cent first-year allowance on qualifying special-rate plant expenditure (most commonly integral features at CAA 2001 s.33A). Both allowances applied to expenditure incurred on or after 1 April 2021 but before 1 April 2023. The conditions, set out at FA 2021 s.9(1), required the plant or machinery to be unused and not second-hand, the company to be within the charge to corporation tax, the expenditure not to be excluded by FA 2021 s.46(2) or by other carve-outs (notably the ring-fence trade carve-out and the s.10 anti-leasing carve-out), and the expenditure not to be in a chargeable period in which the qualifying activity ceased. The regime is now fully expired; current first-year allowance for main-rate plant by companies is full expensing at CAA 2001 s.45S (100 per cent, not 130 per cent), introduced from 1 April 2023 by Finance (No. 2) Act 2023 and made permanent at Autumn Statement 2023.

What is FA 2021 section 12 and what does the disposal clawback do?

FA 2021 section 12 provides for a balancing-charge uplift on disposal of an asset on which a super-deduction was claimed. The mechanic at section 12(3) computes a balancing charge by reference to the disposal value of the asset; section 12(6) and section 12(8) then multiply that base balancing charge by a relevant factor. The relevant factor is 1.3 where the chargeable period of the disposal ends before 1 April 2023; a proportional factor between 1.0 and 1.3 where the period straddles 1 April 2023, calculated per section 12(8). The companion FA 2021 section 13 applies an equivalent mechanism to disposals of assets on which an SR allowance was claimed, with a 1.0 factor relevant for those assets (the SR allowance was a 50 per cent FYA companion, and the disposal clawback for SR is at 1.0 because the 50 per cent allowance was already lower-than-cost, so no uplift is needed). The s.12 and s.13 mechanics overlay the ordinary CAA 2001 s.55 (AQE versus TDR) and s.61 (disposal events and values) framework that governs balancing charges generally.

Does the 1.3x clawback bite on disposals of super-deducted assets in 2026/27?

For most companies, no. Per FA 2021 section 12(6) the 1.3x uplift applies only where the chargeable period of the disposal COMMENCED before 1 April 2023. A 2026/27 disposal by a company on a calendar-year accounting period (1 January to 31 December) takes place in a chargeable period that started 1 January 2026 (or earlier years), well after 1 April 2023. A 2026/27 disposal by a company on an April-to-March accounting period takes place in a chargeable period that started 1 April 2025 or 1 April 2026, well after 1 April 2023. Neither case triggers the section 12 uplift. The disposal proceeds for the fixtures are brought to account under the ordinary CAA 2001 section 61 mechanism at their just-and-reasonable apportionment, capped at the original cost; the resulting balancing charge (where TDR exceeds AQE) is the standard 1.0x figure. The 1.3x uplift is therefore a historical mechanic for the cohort of disposals in chargeable periods that commenced between 1 April 2021 and 31 March 2023.

How is the straddle-period factor calculated under section 12(8)?

Section 12(8) provides the proportional calculation where the chargeable period of the disposal commenced before 1 April 2023 but ends on or after 1 April 2023. The relevant factor is computed by: (i) determining the number of days in the chargeable period that fall before 1 April 2023; (ii) dividing by the total number of days in the chargeable period; (iii) multiplying by 0.3; (iv) adding 1 to the result. A worked example for a 12-month CT period from 1 July 2022 to 30 June 2023: days before 1 April 2023 are 1 July 2022 to 31 March 2023, which is 274 days; total days in the period are 365; the ratio is 274 divided by 365 equals 0.7507; multiplied by 0.3 equals 0.2252; plus 1 equals 1.2252. The relevant factor for this period is 1.2252 (rounded). A disposal value of £80,000 in this period brings a balancing charge of £80,000 multiplied by 1.2252 equals £98,016, subject to the section 12(3) base computation and any AQE adjustments.

Does the section 12 clawback apply where the asset is disposed of at a loss?

Yes if the disposal occurs in a chargeable period that satisfies the section 12(6) gate. The mechanic depends on the disposal value brought to account under CAA 2001 section 61, not on the gain or loss on the asset. A super-deducted asset that originally cost £200,000 and is disposed of for £40,000 in a chargeable period that commenced before 1 April 2023 brings a £40,000 disposal value, uplifted by the 1.3 factor to £52,000. If the pool AQE is zero (because the original super-deduction had been claimed in full and there are no other assets in the pool), the balancing charge is the full £52,000 taxable. The company has a £160,000 economic loss on the asset but a £52,000 tax charge under the s.12 mechanic, a net asymmetric outcome. This is the structural asymmetry of the super-deduction regime: the 130 per cent up-front deduction is matched by a 1.3x disposal uplift that recoups more than 100 per cent of the original cost where the disposal value exceeds 77 per cent of cost; below that breakeven, the company is in net economic relief but still faces a tax charge on disposal.

Can the balancing-charge clawback exceed the original cost of the asset?

In principle yes, in practice rarely. The CAA 2001 section 61 disposal-value mechanic computes disposal value at the just-and-reasonable apportionment of the sale price attributable to the fixtures, capped at the original cost of the relevant expenditure. So the base disposal value is capped at the original cost. The FA 2021 section 12 uplift then multiplies that base disposal value by 1.3 (or the straddle factor). The uplifted disposal value can exceed the original cost (a 1.3x multiplier applied to anything above 77 per cent of cost will exceed cost). The balancing charge brought into the pool computation is the difference between the uplifted disposal value and the pool's AQE. Where the pool's AQE is zero (because the super-deduction had emptied the pool down to nil), the balancing charge equals the full uplifted disposal value. The 1.3x mechanic is calibrated to recoup the 130 per cent original relief: at a disposal value equal to 76.9 per cent of original cost, the 1.3x uplift produces a balancing charge exactly equal to 100 per cent of cost; at higher disposal values, the charge exceeds cost. The asymmetry is intentional, designed to ensure the time-value benefit of the super-deduction is partly recouped on disposal.

What records do I need to defend a super-deduction claim history on enquiry?

The defence pack for a super-deduction claim that is now being followed by a disposal in a non-gated period consists of: (i) the original CT return for the period in which the super-deduction was claimed, with the AIA / FYA computations and the super-deduction line; (ii) the supplier invoices for the original plant purchase, showing the unused-and-not-second-hand condition and the timing (between 1 April 2021 and 31 March 2023); (iii) the FA 2021 s.9(1) eligibility test documentation (chargeable-period within the window; company within CT charge; no leasing-out or other s.46(2) exclusion); (iv) for the disposal, the sale agreement and any quantity surveyor's apportionment between fixtures, building shell, land and goodwill, supporting the disposal value brought to account; (v) the CT computation for the disposal period showing the pool-balance reconciliation and (where the section 12 gate applies) the calculation of the uplifted balancing charge. HMRC enquiry on super-deduction is relatively rare in 2026/27 because the regime is closed, but defence remains worthwhile for the cohort of disposals in pre-1-April-2023 chargeable periods that are still within the four-year amendment window.

How does the super-deduction interact with the current full-expensing regime at CAA 2001 s.45S?

Full expensing replaced the super-deduction from 1 April 2023. The mechanism is different in three material ways. First, the rate: full expensing is 100 per cent main-rate FYA, not 130 per cent. Second, the disposal clawback: full expensing has its own disposal-value mechanism (a 1.0x balancing charge at the apportioned market value, capped at original cost) but no uplift comparable to the FA 2021 s.12 1.3x. Third, the regime status: full expensing was confirmed permanent by Autumn Statement 2023 (no sunset clause in CAA 2001 s.45S as enacted); the super-deduction was always a temporary regime. For a company that claimed super-deduction between 2021 and 2023 and is now considering new plant expenditure in 2026/27, the route is full expensing under s.45S (100 per cent immediate write-off, 1.0x disposal clawback). The 130 per cent rate is unavailable for new spend. Our bucket sibling page on full expensing for commercial property SPVs walks the current regime in detail.

Does the clawback apply to leasing or intra-group disposals?

Yes, with separate carve-outs. The leasing-out carve-out at FA 2021 s.46(2) excluded super-deduction from being claimed on plant intended for leasing out at the original spend stage; this was a frequent disqualifier for buy-to-let landlords and commercial property SPVs whose plant was used in tenanted property. For an asset that satisfied the original conditions and was super-deducted, an intra-group disposal (one group company selling to another) brings in disposal value under CAA 2001 s.61 by reference to the connected-party market-value substitution rule at item 1 of the s.61 Table; the disposal value is the open-market value, and the section 12 uplift applies on top in the disposing company's pool, subject to the section 12(6) chargeable-period gate. The receiving company's pool inherits a qualifying expenditure of the same market-value figure (per the connected-party rules), not the uplifted figure. The economic exposure on the intra-group transfer is therefore concentrated in the disposing company's balancing charge.

Was the brief reference to FA 2021 Sch 9 Part 2 correct?

No. The clawback mechanism for super-deduction is at FA 2021 section 12 (for the 130 per cent super-deduction) and section 13 (for the 50 per cent SR allowance), both sections in Part 1 Chapter 2 of the Act dealing with temporary first-year allowances. FA 2021 does have Schedules attached to it but Schedule 9 is on a different topic. Some draft-period commentary and brief-author memory may have associated the super-deduction clawback with Schedule 9 Part 2 because of how the legislation was originally introduced or because of confusion with another Finance Act's Schedule 9. The authoritative reference is the legislation.gov.uk text of FA 2021 sections 12 and 13, which were verified for this page on 23 May 2026.

Property Types & Specialist Tax

The Super-Deduction Disposal Clawback at FA 2021 s.12: When the 1.3x Uplift Still Bites and When It Does Not (2026/27)

23 May 2026 · Property Tax Partners Editorial Team · 11 min read

The Finance Act 2021 super-deduction (130 per cent main-rate first-year allowance) and the parallel SR allowance (50 per cent special-rate first-year allowance) at FA 2021 sections 9 and 10 ran from 1 April 2021 to 31 March 2023 and have expired. The disposal-value clawback at FA 2021 sections 12 (super-deduction) and 13 (SR allowance) is still on the statute book, but its application is narrower than commonly framed: per section 12(6), the 1.3x uplift applies only where the disposal event occurs in a chargeable period that COMMENCED before 1 April 2023. For most companies on calendar or April-to-March accounting periods, the chargeable period in which a 2026/27 disposal occurs will have commenced well after 1 April 2023, and the uplift does not apply at all. The standard CAA 2001 s.61 disposal-value mechanic (1.0x apportioned market value, capped at original cost) governs instead. The cohort still exposed to the s.12 uplift is narrow: companies that filed (or are still filing) returns for chargeable periods that commenced before 1 April 2023 and that contain disposals of super-deducted assets. The full 1.3 factor applies where the period entirely ends before 1 April 2023; a proportional factor between 1.0 and 1.3 applies via the section 12(8) straddle formula where the period includes 1 April 2023. This page walks the super-deduction regime in summary, the section 12 and section 13 clawback architecture, the chargeable-period commencement gate at section 12(6) (the load-bearing condition most commentary glosses), the straddle formula at section 12(8), three worked disposal scenarios across the three relevant period configurations, and the practical takeaway for SPV and corporate landlords who claimed super-deduction between 2021 and 2023 and are now selling assets.

Skip to enquiry form ↓

The Finance Act 2021 super-deduction at section 9 ran a 130 per cent first-year allowance on main-rate plant and a parallel 50 per cent SR first-year allowance on special-rate plant from 1 April 2021 to 31 March 2023. The regime is closed for new expenditure; full expensing under CAA 2001 section 45S replaced it from 1 April 2023 (current 100 per cent main-rate, not 130 per cent, and the SR allowance is at 50 per cent on the special-rate slice). The disposal-value clawback at FA 2021 sections 12 and 13 remains on the statute book, but its bite is narrower than most popular framings of the super-deduction acknowledge.

The load-bearing condition is at section 12(6): the 1.3x uplift applies only where the disposal event occurs in a chargeable period that COMMENCED before 1 April 2023. For most companies on calendar-year or April-to-March accounting periods, a disposal in 2026/27 sits in a chargeable period that started well after 1 April 2023, and the uplift does not apply at all. The standard CAA 2001 section 61 disposal-value mechanic (1.0x apportioned market value, capped at original cost) governs. The cohort still exposed to the 1.3x uplift is narrow: companies amending or finalising returns for chargeable periods that commenced between 1 April 2021 and 31 March 2023 and that contain disposals of super-deducted assets.

This page walks the super-deduction regime in summary, the section 12 and section 13 clawback architecture, the chargeable-period commencement gate at section 12(6), the straddle formula at section 12(8) for periods including 1 April 2023, three worked disposal scenarios across the three relevant period configurations, and the practical takeaway for SPV and corporate landlords who claimed super-deduction between 2021 and 2023 and are now selling assets.

The super-deduction in summary: FA 2021 ss.9 and 10

FA 2021 section 9 provided the temporary first-year allowance structure that became the headline super-deduction. Subsection (1) set the conditions: expenditure must be capital expenditure on plant or machinery, incurred on or after 1 April 2021 but before 1 April 2023, by a company within the charge to corporation tax, on unused and not second-hand plant or machinery, and not within the FA 2021 section 46(2) exclusions or the general FYA exclusions. Subsection (2) set the main-rate super-deduction at 130 per cent for qualifying expenditure that would otherwise have gone into the main pool. Subsection (3) set the SR allowance at 50 per cent for qualifying expenditure that would otherwise have gone into the special-rate pool (most notably integral features at CAA 2001 section 33A).

FA 2021 section 10 provided supplementary mechanics including the anti-avoidance counteraction for arrangements designed to bring expenditure within the regime that would not otherwise qualify, and the alignment with the existing CAA 2001 framework on pool allocation, disposal value, and balancing adjustments.

The section 46(2) exclusion for plant intended for leasing was the most operationally material disqualifier for property landlord readers. A residential landlord SPV that bought new boilers, white goods or integral-features plant for installation in a let property could not claim super-deduction on the spend because the plant was for leasing out within the meaning of section 46(2). The leasing exclusion materially narrowed the practical reach of super-deduction in the property sector; the regime mostly benefited corporate users of plant in trade-grade premises rather than buy-to-let owners.

The clawback architecture at FA 2021 ss.12 and 13

FA 2021 section 12 provides the disposal-value clawback for the 130 per cent main-rate super-deduction. The mechanic operates by overlaying a relevant-factor multiplier on the disposal value computed under CAA 2001 section 61. Section 12(3) computes the base balancing charge by reference to the disposal proceeds (or the market value where the section 61 connected-party substitution applies). Section 12(6) then multiplies that base figure by the relevant factor where the section 12(6) gate is satisfied.

Section 12(7) provides the relevant factor of 1.3 where the chargeable period ends entirely before 1 April 2023. Section 12(8) provides the straddle-period proportional formula where the chargeable period commenced before 1 April 2023 but ends on or after that date. The formula: relevant factor equals 1 plus (days in the period before 1 April 2023 divided by total days in the period) multiplied by 0.3. The factor ranges between 1.0 (where all days fall after 1 April 2023, which by definition cannot happen if the period commenced before that date) and 1.3 (where all days fall before, which is the section 12(7) case).

FA 2021 section 13 provides the parallel mechanic for disposals of assets that received the 50 per cent SR allowance. The relevant factor under section 13 is 1.0 across all chargeable periods. The economic rationale is that the 50 per cent SR allowance was already a discounted first-year allowance against the cost of the asset, so no uplift on disposal is needed to claw back the relief; the standard 1.0x mechanism under CAA 2001 section 61 does the work. Operators who claimed the SR allowance on integral features between 2021 and 2023 therefore face no super-deduction-specific uplift on disposal.

The section 12(6) chargeable-period commencement gate

Section 12(6) reads verbatim: "If the disposal event occurs in a chargeable period that commenced before 1 April 2023 the amount of the balancing charge is the amount determined under subsection (3) multiplied by the relevant factor." The condition turns on the commencement date of the chargeable period in which the disposal event occurs.

Three configurations result. The first is the entirely-pre-1-April-2023 case: a chargeable period that both commenced and ended before 1 April 2023. A disposal in this period attracts the full 1.3 factor under section 12(7). In practice, the latest such period would be a 12-month CT period from 1 April 2022 to 31 March 2023 (the regime's last operating period); disposals within this period are now historic and most companies have filed and finalised the relevant CT returns. The four-year amendment window for the period ending 31 March 2023 closes around 31 March 2027, so there is still scope for an amendment of these historic returns to surface a super-deduction clawback for completeness, but the cohort is narrow.

The second configuration is the straddle case: a chargeable period that commenced before 1 April 2023 but ends on or after that date. The most common straddle would be a 12-month CT period from 1 October 2022 to 30 September 2023, or 1 July 2022 to 30 June 2023, or similar. Disposals in straddle periods attract a proportional factor between 1.0 and 1.3 calculated per section 12(8). These returns may still be under preparation or in early enquiry stages depending on the company's filing pattern.

The third configuration is the post-1-April-2023 case: a chargeable period that commenced on or after 1 April 2023. Disposals in such periods do not satisfy the section 12(6) gate and the 1.3 factor does not apply. The disposal value runs at the standard CAA 2001 section 61 1.0x figure. Most 2026/27 disposals by companies on normal accounting periods fall into this configuration. The 1.3x uplift is therefore largely historical for current-year disposals.

Worked clawback 1: period entirely pre-1-April-2023

Anonymised industrial SPV Manchester Industrial Holdings Limited has a 12-month CT period from 1 April 2022 to 31 March 2023. During the period, the SPV disposed of a piece of main-rate plant on which a £500,000 super-deduction had been claimed in the period ended 31 March 2022. The disposal occurred on 1 December 2022 for £320,000. The SPV is finalising the 31 March 2023 CT return in 2026 after a delayed close-out following a directorate change.

The chargeable period ended before 1 April 2023; the section 12(6) gate is satisfied. The relevant factor under section 12(7) is 1.3. The base disposal value under CAA 2001 section 61 is the apportioned £320,000 sale figure, capped at the original cost of £500,000 (the cap does not bite). The uplifted disposal value is £320,000 multiplied by 1.3 equals £416,000. The pool AQE at the start of the period was zero (the super-deduction having taken the original spend out in the period of incurring). The balancing charge under section 55 is the full £416,000 brought to account in the chargeable period as a trading receipt. At the main 25 per cent CT rate, the charge generates £104,000 of CT.

The SPV's original benefit from the super-deduction at the time was £500,000 multiplied by 130 per cent equals £650,000 deduction, generating £162,500 of CT relief at 25 per cent. The disposal clawback recoups £104,000 of CT. The net economic relief to the SPV across the two periods is £162,500 minus £104,000 equals £58,500, against a £180,000 economic loss on the asset (sold for £320,000 having originally cost £500,000). The super-deduction has delivered a real net economic benefit, but the disposal clawback significantly trims it relative to the headline 130 per cent rate.

Want this checked against your specific situation?

Drop your email and a one-line summary. We reply within 24 hours, no phone call needed.

Worked clawback 2: straddle period including 1 April 2023

Anonymised commercial property developer Sheffield Brownfield Developments Limited has a 12-month CT period from 1 July 2022 to 30 June 2023. During the period, the developer disposed of a piece of main-rate plant on which a £150,000 super-deduction had been claimed in the period ended 30 June 2022. The disposal occurred on 15 May 2023 for £100,000.

The chargeable period commenced on 1 July 2022 (before 1 April 2023); the section 12(6) gate is satisfied. The chargeable period ends on 30 June 2023 (after 1 April 2023); the straddle-period formula at section 12(8) applies. Days in the period before 1 April 2023: 1 July 2022 to 31 March 2023 equals 274 days. Total days in the period: 365. Ratio: 274 divided by 365 equals 0.7507. Multiplied by 0.3: 0.2252. Plus 1: 1.2252. The relevant factor is 1.2252.

The base disposal value under CAA 2001 section 61 is £100,000. The uplifted disposal value is £100,000 multiplied by 1.2252 equals £122,520. The balancing charge brought to account is £122,520 (the pool AQE being zero). At the main 25 per cent CT rate, the charge generates £30,630 of CT in the period ending 30 June 2023.

Worked no-clawback: period commenced after 1 April 2023

Anonymised LtdCo investor Birmingham Industrial Investors Limited has a 12-month CT period from 1 January 2026 to 31 December 2026. During the period, the LtdCo disposed of a piece of main-rate plant on which a £200,000 super-deduction had been claimed in the period ended 31 December 2022. The disposal occurred on 1 July 2026 for £140,000.

The chargeable period commenced on 1 January 2026 (after 1 April 2023). The section 12(6) gate is NOT satisfied. The 1.3x uplift does not apply. The disposal value brought to account under CAA 2001 section 61 is the standard 1.0x figure: £140,000, capped at the original cost of £200,000 (the cap does not bite). The balancing charge under section 55 is £140,000 (the pool AQE being zero). At the main 25 per cent CT rate, the charge generates £35,000 of CT.

If the disposal had been in a chargeable period entirely before 1 April 2023, the 1.3x uplift would have applied and the balancing charge would have been £140,000 multiplied by 1.3 equals £182,000, with a CT impact of £45,500. The post-1-April-2023 timing therefore saves the LtdCo £10,500 of CT relative to the pre-gate counterfactual. The saving is not a planning lever (the company cannot accelerate or delay the disposal to manipulate the section 12 gate without other commercial considerations dominating), but it is the structural reason most 2026/27 disposals of super-deducted assets are not subject to the 1.3x clawback.

Practical takeaway for property and corporate landlords

Three points govern the practical position in 2026/27. First, the super-deduction regime is closed and replaced by full expensing at CAA 2001 section 45S; the current first-year allowance on new main-rate plant by a company is 100 per cent, not 130 per cent. Second, the section 12 disposal clawback at 1.3x applies only where the chargeable period of the disposal event commenced before 1 April 2023; for most 2026/27 disposals by companies on normal accounting periods, the gate is not satisfied and the standard CAA 2001 section 61 1.0x disposal-value mechanic governs. Third, the section 13 clawback on SR allowance assets (the 50 per cent special-rate FYA companion) operates at 1.0x with no uplift in all chargeable periods, mirroring the standard disposal mechanic.

The narrow cohort still exposed to the 1.3x uplift consists of companies finalising or amending CT returns for chargeable periods that commenced before 1 April 2023 and that contain disposals of main-rate super-deducted assets. The four-year amendment window for the latest such period (ending 31 March 2023 for an April-to-March company) closes around 31 March 2027, after which the historic clawback essentially becomes dead letter. For companies considering retrospective amendments or finalising delayed returns, the section 12 computation should be done carefully with attention to the gate and the straddle formula.

For all other current-year decisions on plant-and-machinery acquisition and disposal in property SPV portfolios, the live framework is full expensing at CAA 2001 section 45S (100 per cent main-rate FYA on unused new plant by companies), the 50 per cent special-rate FYA companion under s.45S(5), the AIA at £1m cap (permanent from 1 April 2023 per FA(No.2) 2023), and the standard CAA 2001 section 61 disposal-value mechanic at 1.0x. Our bucket sibling pages on full expensing, the AIA framework, and the disposal mechanics page walk the current framework in detail.

Where this page sits in the Bucket C cluster

This page is the historic-clawback complement to the disposal-mechanics depth and the full-expensing page. It sits downstream of the pillar at C1 on the CAA 2001 framework, which establishes the four-axis decision matrix and identifies the super-deduction as the expired historical predecessor to current full expensing. It interacts with C2 on the standard 1.0x disposal mechanic, with C5 on the current 100 per cent full-expensing regime, and (across buckets) with the wider extraction-sequence pillar at A1 on the disposal-side cash flows that the clawback affects.

The position above applies for chargeable periods ending in 2026/27 onwards and reflects the legislation as enacted at 23 May 2026. The FA 2021 sections 9, 10, 12 and 13 statutory text is verified against the legislation.gov.uk pages on that date. The section 12(6) chargeable-period commencement gate, the section 12(7) full 1.3 factor for entirely-pre-1-April-2023 periods, the section 12(8) straddle-period proportional formula, and the section 13 1.0 factor for SR allowance assets all carry the load-bearing positions on the historic clawback as enacted.

Have a specialist property tax question?

Furnished holiday lets, mixed-use, HMOs, commercial, agricultural. Get a specialist who has handled your property type before.

Frequently asked questions

What was the super-deduction at FA 2021 s.9 and when did it apply?: The super-deduction was a 130 per cent first-year allowance on qualifying main-rate plant-and-machinery expenditure by companies within the charge to corporation tax. The companion SR (special-rate) allowance at FA 2021 s.9(3) gave a 50 per cent first-year allowance on qualifying special-rate plant expenditure (most commonly integral features at CAA 2001 s.33A). Both allowances applied to expenditure incurred on or after 1 April 2021 but before 1 April 2023. The conditions, set out at FA 2021 s.9(1), required the plant or machinery to be unused and not second-hand, the company to be within the charge to corporation tax, the expenditure not to be excluded by FA 2021 s.46(2) or by other carve-outs (notably the ring-fence trade carve-out and the s.10 anti-leasing carve-out), and the expenditure not to be in a chargeable period in which the qualifying activity ceased. The regime is now fully expired; current first-year allowance for main-rate plant by companies is full expensing at CAA 2001 s.45S (100 per cent, not 130 per cent), introduced from 1 April 2023 by Finance (No. 2) Act 2023 and made permanent at Autumn Statement 2023.
What is FA 2021 section 12 and what does the disposal clawback do?: FA 2021 section 12 provides for a balancing-charge uplift on disposal of an asset on which a super-deduction was claimed. The mechanic at section 12(3) computes a balancing charge by reference to the disposal value of the asset; section 12(6) and section 12(8) then multiply that base balancing charge by a relevant factor. The relevant factor is 1.3 where the chargeable period of the disposal ends before 1 April 2023; a proportional factor between 1.0 and 1.3 where the period straddles 1 April 2023, calculated per section 12(8). The companion FA 2021 section 13 applies an equivalent mechanism to disposals of assets on which an SR allowance was claimed, with a 1.0 factor relevant for those assets (the SR allowance was a 50 per cent FYA companion, and the disposal clawback for SR is at 1.0 because the 50 per cent allowance was already lower-than-cost, so no uplift is needed). The s.12 and s.13 mechanics overlay the ordinary CAA 2001 s.55 (AQE versus TDR) and s.61 (disposal events and values) framework that governs balancing charges generally.
Does the 1.3x clawback bite on disposals of super-deducted assets in 2026/27?: For most companies, no. Per FA 2021 section 12(6) the 1.3x uplift applies only where the chargeable period of the disposal COMMENCED before 1 April 2023. A 2026/27 disposal by a company on a calendar-year accounting period (1 January to 31 December) takes place in a chargeable period that started 1 January 2026 (or earlier years), well after 1 April 2023. A 2026/27 disposal by a company on an April-to-March accounting period takes place in a chargeable period that started 1 April 2025 or 1 April 2026, well after 1 April 2023. Neither case triggers the section 12 uplift. The disposal proceeds for the fixtures are brought to account under the ordinary CAA 2001 section 61 mechanism at their just-and-reasonable apportionment, capped at the original cost; the resulting balancing charge (where TDR exceeds AQE) is the standard 1.0x figure. The 1.3x uplift is therefore a historical mechanic for the cohort of disposals in chargeable periods that commenced between 1 April 2021 and 31 March 2023.
What is the chargeable-period commencement gate at section 12(6)?: Section 12(6) of FA 2021 states verbatim: 'If the disposal event occurs in a chargeable period that commenced before 1 April 2023 the amount of the balancing charge is the amount determined under subsection (3) multiplied by the relevant factor.' The condition is on the commencement date of the chargeable period in which the disposal event occurs, not on the date of the disposal event itself and not on the date the asset was super-deducted. A disposal on 30 June 2024 in a chargeable period that started 1 October 2023 does not satisfy the gate (period commenced after 1 April 2023); the disposal proceeds run at 1.0x under CAA 2001 s.61 with no uplift, even though the asset was originally super-deducted in 2022. The gate is the load-bearing condition that limits the historic clawback to the period the regime was live and the immediately surrounding straddle window. Many secondary-source commentaries on the super-deduction frame the clawback as 'continues to apply indefinitely on disposal of super-deducted assets' without reading the section 12(6) gate; the framing is wrong.
How is the straddle-period factor calculated under section 12(8)?: Section 12(8) provides the proportional calculation where the chargeable period of the disposal commenced before 1 April 2023 but ends on or after 1 April 2023. The relevant factor is computed by: (i) determining the number of days in the chargeable period that fall before 1 April 2023; (ii) dividing by the total number of days in the chargeable period; (iii) multiplying by 0.3; (iv) adding 1 to the result. A worked example for a 12-month CT period from 1 July 2022 to 30 June 2023: days before 1 April 2023 are 1 July 2022 to 31 March 2023, which is 274 days; total days in the period are 365; the ratio is 274 divided by 365 equals 0.7507; multiplied by 0.3 equals 0.2252; plus 1 equals 1.2252. The relevant factor for this period is 1.2252 (rounded). A disposal value of £80,000 in this period brings a balancing charge of £80,000 multiplied by 1.2252 equals £98,016, subject to the section 12(3) base computation and any AQE adjustments.
Is there a difference between the s.12 clawback (130% super-deduction) and the s.13 clawback (50% SR allowance)?: Yes. FA 2021 section 12 applies the 1.3x uplift (or straddle-proportional factor between 1.0 and 1.3) to disposals of assets that received the 130 per cent main-rate super-deduction. FA 2021 section 13 applies an equivalent disposal-value computation for assets that received the 50 per cent SR allowance, but with a relevant factor of 1.0 (no uplift). The economic logic is that the 50 per cent SR allowance was already a discounted first-year allowance against the cost of the asset, so no uplift on disposal is needed to claw back the relief; the standard 1.0x disposal mechanism does the work. Operators who claimed the SR allowance on integral features between 2021 and 2023 face the ordinary CAA 2001 section 61 disposal mechanic on those assets with no super-deduction-specific uplift. Operators who claimed the main-rate super-deduction on general plant face the section 12 uplift on disposals within the section 12(6) chargeable-period gate.
Does the section 12 clawback apply where the asset is disposed of at a loss?: Yes if the disposal occurs in a chargeable period that satisfies the section 12(6) gate. The mechanic depends on the disposal value brought to account under CAA 2001 section 61, not on the gain or loss on the asset. A super-deducted asset that originally cost £200,000 and is disposed of for £40,000 in a chargeable period that commenced before 1 April 2023 brings a £40,000 disposal value, uplifted by the 1.3 factor to £52,000. If the pool AQE is zero (because the original super-deduction had been claimed in full and there are no other assets in the pool), the balancing charge is the full £52,000 taxable. The company has a £160,000 economic loss on the asset but a £52,000 tax charge under the s.12 mechanic, a net asymmetric outcome. This is the structural asymmetry of the super-deduction regime: the 130 per cent up-front deduction is matched by a 1.3x disposal uplift that recoups more than 100 per cent of the original cost where the disposal value exceeds 77 per cent of cost; below that breakeven, the company is in net economic relief but still faces a tax charge on disposal.
Can the balancing-charge clawback exceed the original cost of the asset?: In principle yes, in practice rarely. The CAA 2001 section 61 disposal-value mechanic computes disposal value at the just-and-reasonable apportionment of the sale price attributable to the fixtures, capped at the original cost of the relevant expenditure. So the base disposal value is capped at the original cost. The FA 2021 section 12 uplift then multiplies that base disposal value by 1.3 (or the straddle factor). The uplifted disposal value can exceed the original cost (a 1.3x multiplier applied to anything above 77 per cent of cost will exceed cost). The balancing charge brought into the pool computation is the difference between the uplifted disposal value and the pool's AQE. Where the pool's AQE is zero (because the super-deduction had emptied the pool down to nil), the balancing charge equals the full uplifted disposal value. The 1.3x mechanic is calibrated to recoup the 130 per cent original relief: at a disposal value equal to 76.9 per cent of original cost, the 1.3x uplift produces a balancing charge exactly equal to 100 per cent of cost; at higher disposal values, the charge exceeds cost. The asymmetry is intentional, designed to ensure the time-value benefit of the super-deduction is partly recouped on disposal.
What records do I need to defend a super-deduction claim history on enquiry?: The defence pack for a super-deduction claim that is now being followed by a disposal in a non-gated period consists of: (i) the original CT return for the period in which the super-deduction was claimed, with the AIA / FYA computations and the super-deduction line; (ii) the supplier invoices for the original plant purchase, showing the unused-and-not-second-hand condition and the timing (between 1 April 2021 and 31 March 2023); (iii) the FA 2021 s.9(1) eligibility test documentation (chargeable-period within the window; company within CT charge; no leasing-out or other s.46(2) exclusion); (iv) for the disposal, the sale agreement and any quantity surveyor's apportionment between fixtures, building shell, land and goodwill, supporting the disposal value brought to account; (v) the CT computation for the disposal period showing the pool-balance reconciliation and (where the section 12 gate applies) the calculation of the uplifted balancing charge. HMRC enquiry on super-deduction is relatively rare in 2026/27 because the regime is closed, but defence remains worthwhile for the cohort of disposals in pre-1-April-2023 chargeable periods that are still within the four-year amendment window.
How does the super-deduction interact with the current full-expensing regime at CAA 2001 s.45S?: Full expensing replaced the super-deduction from 1 April 2023. The mechanism is different in three material ways. First, the rate: full expensing is 100 per cent main-rate FYA, not 130 per cent. Second, the disposal clawback: full expensing has its own disposal-value mechanism (a 1.0x balancing charge at the apportioned market value, capped at original cost) but no uplift comparable to the FA 2021 s.12 1.3x. Third, the regime status: full expensing was confirmed permanent by Autumn Statement 2023 (no sunset clause in CAA 2001 s.45S as enacted); the super-deduction was always a temporary regime. For a company that claimed super-deduction between 2021 and 2023 and is now considering new plant expenditure in 2026/27, the route is full expensing under s.45S (100 per cent immediate write-off, 1.0x disposal clawback). The 130 per cent rate is unavailable for new spend. Our bucket sibling page on <a href="/blog/property-types-and-specialist-tax/full-expensing-50-percent-fya-commercial-property-spvs-mechanics-fa-2023">full expensing for commercial property SPVs</a> walks the current regime in detail.
Does the clawback apply to leasing or intra-group disposals?: Yes, with separate carve-outs. The leasing-out carve-out at FA 2021 s.46(2) excluded super-deduction from being claimed on plant intended for leasing out at the original spend stage; this was a frequent disqualifier for buy-to-let landlords and commercial property SPVs whose plant was used in tenanted property. For an asset that satisfied the original conditions and was super-deducted, an intra-group disposal (one group company selling to another) brings in disposal value under CAA 2001 s.61 by reference to the connected-party market-value substitution rule at item 1 of the s.61 Table; the disposal value is the open-market value, and the section 12 uplift applies on top in the disposing company's pool, subject to the section 12(6) chargeable-period gate. The receiving company's pool inherits a qualifying expenditure of the same market-value figure (per the connected-party rules), not the uplifted figure. The economic exposure on the intra-group transfer is therefore concentrated in the disposing company's balancing charge.
Was the brief reference to FA 2021 Sch 9 Part 2 correct?: No. The clawback mechanism for super-deduction is at FA 2021 section 12 (for the 130 per cent super-deduction) and section 13 (for the 50 per cent SR allowance), both sections in Part 1 Chapter 2 of the Act dealing with temporary first-year allowances. FA 2021 does have Schedules attached to it but Schedule 9 is on a different topic. Some draft-period commentary and brief-author memory may have associated the super-deduction clawback with Schedule 9 Part 2 because of how the legislation was originally introduced or because of confusion with another Finance Act's Schedule 9. The authoritative reference is the legislation.gov.uk text of FA 2021 sections 12 and 13, which were verified for this page on 23 May 2026.

The Super-Deduction Disposal Clawback at FA 2021 s.12: When the 1.3x Uplift Still Bites and When It Does Not (2026/27)

The super-deduction in summary: FA 2021 ss.9 and 10

The clawback architecture at FA 2021 ss.12 and 13

The section 12(6) chargeable-period commencement gate

Worked clawback 1: period entirely pre-1-April-2023

Want this checked against your specific situation?

Worked clawback 2: straddle period including 1 April 2023

Worked no-clawback: period commenced after 1 April 2023

Practical takeaway for property and corporate landlords

Where this page sits in the Bucket C cluster

Have a specialist property tax question?

Frequently asked questions

A Complete Guide to the Community Infrastructure Levy (CIL): Statutory Location, Calculation, Reliefs, and the s.106 Overlay

Big Tax Changes Ahead for Furnished Holiday Lettings

Council Tax for New Builds: When Liability Begins, the s.17 Completion-Notice Machinery, and the Valuation Tribunal Appeal Route

The super-deduction in summary: FA 2021 ss.9 and 10

The clawback architecture at FA 2021 ss.12 and 13

The section 12(6) chargeable-period commencement gate

Worked clawback 1: period entirely pre-1-April-2023

Want this checked against your specific situation?

Worked clawback 2: straddle period including 1 April 2023

Worked no-clawback: period commenced after 1 April 2023

Practical takeaway for property and corporate landlords

Where this page sits in the Bucket C cluster

Have a specialist property tax question?

Frequently asked questions

Related articles

A Complete Guide to the Community Infrastructure Levy (CIL): Statutory Location, Calculation, Reliefs, and the s.106 Overlay

Big Tax Changes Ahead for Furnished Holiday Lettings

Council Tax for New Builds: When Liability Begins, the s.17 Completion-Notice Machinery, and the Valuation Tribunal Appeal Route