Zoned In or Out: Freeports and Investment Zones

Zoned In or Out: Freeports and Investment Zones

In the 2024 Spring Budget, the UK Government announced further details on the Investment Zones and Freeports regime.
Investment Zones and Freeports are geographically specific areas, intended to promote regeneration and bridge the gap between economically disparate regions in the UK. Freeports will be based at seaports and airports where goods come in and out of the UK, whereas Investment Zones will be based around local research institutions or universities.

Freeports and Investment Zones aim to encourage rapid development and business investment, in turn supporting growth and employment. They will both benefit from a variety of tax incentives – the major incentives are detailed below:

FreeportsInvestment Zones
Freeports receive all the tax benefits applicable to investment zones: Stamp Duty relief, business rates relief, capital allowances plus further benefits:
• Simplified customs arrangements, including reduced documentation, delayed payment of tariffs, and cheaper imported components;
• The ability to zero-rate certain supplies of goods under freeport customs special procedure which are sold between authorised freeport businesses;
• Businesses can also zero-rate certain supplies of services performed by authorised persons in relation to goods that are declared to the freeport customs special procedure.
• Employer national insurance contribution (NIC) threshold raised from £9,100 (2023/24) to £25,000 in respect of new eligible employees for the first 36 months of their employment;
• Full business rates relief for newly occupied business premises, and certain existing businesses where they expand in special tax sites;
• First year capital allowances (FYAs): a 100% first-year allowance for expenditure on plant and machinery;
• Enhanced structures and buildings allowances (SBAs);
• Full Stamp Duty Relief for land and buildings (SDLT) purchased for commercial use or development for commercial purposes.

For further assistance in understanding more about the Freeport and Investment Zone regimes, or assessing how they could benefit your business, please contact us.


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