SUMMARY OF FREEPORT TAX ADVANTAGES

Paul Crichton

SUMMARY OF FREEPORT TAX ADVANTAGES


The main tax and customs duty advantages of locating in a designated freeport area are as follows:

  • SDLT exemption on the purchase of land and buildings in the area
  • 10 year write off of the cost of constructing or renovating a commercial property
  • Enhanced capital allowances for investment in plant and machinery
  • Exemption from employers NICs for certain staff working in the freeport area
  • Special VAT and Customs Duty rules

Seven of the eight freeport areas are on the coast and thus ideal locations for businesses importing goods into the UK. There is however no restriction on the nature of business carried out within the designated freeport area.

The eighth English freeport is around East Midlands Airport which would be an ideal place to locate a distribution centre, being halfway up the M1 motorway.

Scotland is set to have two types of freeport as the UK and Scottish Governments could not agree on a common approach.  As well as the eight Freeports in England the UK Government plans to have at least one in Scotland.  The disputes have not yet been settled and continue to rumble along.  There is more on this at the BBC website.