Enhanced Capital Allowance (ECA) Scheme

Enhanced Capital Allowances

Enhanced Capital Allowance (ECA) Scheme is a key part of the Government’s programme to manage climate change.  It providesEnhanced Capital Allowance (ECA) Scheme provides Northern Ireland businesses with tax relief for install of energy efficient renewable energy systems.  The Enhanced Capital Allowance (ECA) scheme encourages Northern Ireland businesses to invest, and install approved energy saving equipment specified on the Energy Technology List (ETL) and helps to reduce the capital pay-back period of the equipment.

If you are a business owner in Northern Ireland and you wish to installed a renewable energy system to reduce your co2 and heating bills, you may wish to use Enhanced Capital Allowances (ECA) which can be submitted as part of your normal coporate or income tax return, to improve your cash flow through accelerated tax relief



How the Enhanced Capital Allowance (ECA) Scheme works

If a business spent £1000 on a new electric motor, claimed a standard capital allowance at the 18% rate and paid 23% corporation tax (other rates exist, see HMRC’s information on Corporation Tax rates) then the tax relief would be £41.40 in the first year. Further tax relief could be claimed in subsequent years. If however the business invested in a higher efficiency motor listed on the Energy Technology List then it could claim an Enhanced Capital Allowance, giving a one-off 100% tax relief of £230.


The ETL is managed by the Carbon Trust, and The Carbon Trust in Northern Ireland can also offer you an interest free loan to iinitially purchase this energy saving equipment, (click here for details) .  An up-to-date list of the technologies that qualify for the allowance can be found on the Energy Technology Product List (ETPL).  



 Further Information on the Enhanced Capital Allowance (ECA) Scheme

Many of the renewable energy systems that Acorn Renewables Ltd install in commercial premises throughout Northern Ireland will qualify for the Enhanced Capital Allowance (ECA)