Carbon Trust - Low Interest Loans

Financing information for business customers investing in energy efficient equipment / heating - loans and other financing options.

Carbon Trust Logo

Investing in energy efficient equipment makes sound business and environmental sense, especially with the easy, affordable and flexible Energy Efficiency Financing scheme brought to you by Carbon Trust Implementation Services (CTIS) and Siemens Financial Services.

These agencies have combined forces, and together are offering leases, loans and other financing options to all types of organisations seeking to reduce their energy use. New, more efficient equipment should lower energy bills and with payments calculated so that they can be offset by the anticipated energy savings, the financing option is designed to pay for itself.

Warmco Space Heating are a registered Carbon Trust Supplier/Installer and are happy to provide assistance with the loan application where necessary.

Please note: to qualify for the loan you must have an existing heating system which is not considered to be energy efficient. The installation of your new heating will therefore see considerable reduction in your use of energy.

Enhanced Capital Allowances (ECAs)

Winterwarm TR Heater

Enhanced Capital Allowances (ECAs) are a straightforward way for a business to improve its cash flow through accelerated tax relief. The ECA scheme for energy-saving technologies encourages businesses to invest in energy-saving plant or machinery specified on the Energy Technology List (ETL). This specifies the energy-saving technologies that are included in the ECA scheme. This is managed by the Carbon Trust on behalf of Government.

Due to the modulation feature on the majority of heaters which Warmco supply and install, most of our products can be found on the Enhanced Capital Allowance Products List.

Heating equipment, must be at least 91% net efficient to qualify. So as well as reducing your tax burden, this would normally give a saving of at least 30% on your fuel bills.

The scheme allows businesses to write off the whole cost of the equipment against taxable profits in the year of purchase.

This can provide a cash flow boost and an incentive to invest in energy-saving equipment which normally carries a price premium when compared to less efficient alternatives.

How does the ECA scheme work?

The Enhanced Capital Allowance (ECA) scheme enables businesses to claim 100% first-year capital allowance on investments in energy-saving equipment, against the taxable profits of the period of investment. All businesses that incur qualifying spending can claim ECAs.

A higher standard of energy-saving - an example of the money saved

Capital allowances enable businesses to write off the capital cost of purchasing plant and machinery, for example equipment such as heaters, against their taxable profits. They take the place of depreciation charged in commercial accounts.

Energy Technology List
  • The general rate of capital allowances is 20% a year on a reducing balance basis. For example, if a business spent £1,000 on a new heater, it could claim capital allowances of £200 (20% of £1,000) against the taxable profits of the period of investment. Assuming the company pays corporation tax at 28%, the effect of the capital allowance for spending on the heater in the period of investment would be to reduce the business's tax bill by £56 (£200 @ 28%).
    The unrelieved balance of £800 (£1,000 less £200) is carried forward for relief against profits of later years. In this way the spending is written off over a number of years.
  • If, however, the business invested the same amount in a high efficiency heater from the Energy Technology Product List, it could claim an 100% first-year capital allowance of £1,000 against the taxable profits of the year of investment. Again assuming the company pays corporation tax at 28% the effect of the first-year allowance would be to reduce the business's tax bill by £280 (£1,000 @ 28%). Thus, the first-year allowance can confer a cash flow advantage.
    The 100% first-year capital allowance relieves all the qualifying spending. Therefore there is no unrelieved spending to carry forward against profits of later years.

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Dave Salmon, Cavalier Bathrooms, Keighley

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