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Tax and Customs Incentives

 

PASD Freeport offers a range of generous financial incentives for eligible businesses locating in the Freeport’s tax sites:

• Enhanced Capital Allowance – 100% first year allowances for qualifying expenditure on plant and machinery which is primarily for use in a Freeport tax site.

• 100% Business Rates Relief – 5 years full relief from business rates on qualifying new properties and partial relief for expanded properties in Freeport tax sites.

• 0% National Insurance Contributions Relief – 0% Employer NICs paid on salary up to £25,000 p/a,for 3 years per eligible employee hired before 6 April 2031.

• Enhanced Structures and Buildings Allowance – 10% p/a rate of structures and buildings allowance compared to 3% outside Freeport tax sites.

• Full Stamp Duty Land Tax Relief – Total relief from Stamp Duty Land Tax on property used for qualifying commercial purposes.

 

Tax benefits and reliefs are available to businesses which locate in the Freeport up to and including 30 September 2031 meaning businesses can be in receipt of reliefs into the mid-2030s.

 

Scenario 1:

  • Company acquires non-residential property in Freeport for £2m with £100,000 rateable value
  • Company employs 200 people with salaries of £25,000 each starting 2027/28

Scenario 2:

  • Company spends £5 million renovating building for non-residential use – bought into qualifying use 2027/28
  • Company spends £1 million on Special Rate plant and machinery – bought into qualifying use in 2027/28

Please note these figures/scenarios are indicative and hires must be made, rates commenced or capital expenditure incurred prior to 30 September 2031. Investors should obtain their own independent financial, taxation and legal advice before making any investment decisions.

Scenario 2 table showing a business saving £746,500 by using the tax reliefs available while operating within a freeport, including Stamp Duty and Land Tax Relief, Business Rates Relief, Class 1 National Insurance Relief
Scenerio 1 table showing a business making £205,000 net savings by operating in Freeport area

* Note that inflation in the National Insurance threshold and Business Rate multipliers impacts the estimated cumulative reliefs
** Salaries >£25,000 will require Class 1 NI payments inside and outside a Freeport.

*** Based on a Corporate Tax rate of 25% and assumes Company makes sufficient profits to benefit from the enhanced allowances

Customs Offer

  • The PASD Freeport has three designated tax sites at South Yard, Langage and Sherford
  • The sites at Langage and Sherford will also include a customs offer (combined tax and customs sites) so benefit from tax incentives and exemptions
  • Alongside our two identified combined tax and customs sites, we are able to bring forward additional customs sites now which are situated within the Freeport’s Outer Boundary – subject to the HMRC authorisation process
  • Whilst alignment with the Freeport’s key identified target sectors of marine, defence and space with low carbon applications would be advantageous for future potential clustering and supply chain opportunities, it is not a condition of Outer Boundary customs sites that businesses must operate in these sectors to be considered as a customs site operator (CSO)
  • The region has a strong local capability in advanced manufacturing; the Freeport is working strategically with key alliances and trade associations including Plymouth Manufacturers’ Group and the Chamber of Commerce to bring on more customs sites
  • You can view the Freeport’s outer boundary here

Contact us to discuss how your business could have its own customs site situated within the Freeport’s Outer Boundary.

Subject to the HMRC authorisation process, eligible businesses operating in a Freeport customs site can take advantage of:

 

  • Duty exemption – goods brought into a Freeport customs site can be processed and re-exported without the expense of formally importing them into the UK.
  • Duty suspension – goods can be brought into a Freeport customs site and stored in suspense without paying duty to maximise inventory flexibility and cashflow benefit
  • Duty inversion – goods assembled in a Freeport customs site and subsequently imported into the UK only attract the duty associated with either the raw materials OR the finished product depending on whichever is lower (this choice is not allowed in some specific circumstances please contact HMRC for further details)
  • Businesses operating within Freeport customs sites will also have access to simplified customs arrangements
  • Freeport customs benefits reduce costs and make more efficient use of working capital to allow faster growth and more employment.

More information is available on the HMRC webpage – HMRC guidance on customs sites.

  • HMRC Freeports induction pack: guidance providing information on the tax and customs measures for businesses interested in operating within a Freeport
  • HMRC Freeports business examples: a selection of business user journeys, operating within different sectors and operating models, covering both customs and tax site benefits within a Freeport.

How we will support you:

 

  • Teams call and site visit to assess your business undertaken by a member of our team
  • Follow-up consultation with Freeports Hub consultant to input your customs activity into our customs model to identify indicative cost savings and cashflow benefit
  • Early stage support with submitting your application(s) to HMRC
  • If you’d like to find out more about establishing a customs site for your business please email info@pasdfreeport.com with ‘Customs Enquiry’ in the subject line