These Regulations may be cited as the Designation of Special Tax Sites (Anglesey Freeport) Regulations 2025 and come into force on 21st November 2025.
The Designation of Special Tax Sites (Anglesey Freeport) Regulations 2025
Published: Thu 16th Oct 25
These Regulations, made by the Treasury under powers granted by the Finance Act 2021, officially designate specific map-defined areas within the Anglesey Freeport as 'special tax sites' effective from November 21, 2025.
The designation makes qualifying capital expenditure by companies on plant, machinery, and non-residential structures within these sites eligible for enhanced capital allowances under key provisions of the Capital Allowances Act 2001.
Arguments For
The regulations implement provisions of the Finance Act 2021 to encourage investment and economic activity within designated freeport areas through enhanced capital allowances.
Establishing clearly defined 'special tax sites' provides certainty for businesses regarding eligibility for enhanced tax reliefs concerning plant, machinery, and structures/buildings allowances.
The designation supports the government's economic strategy by focusing fiscal incentives on specific geographical zones intended to foster trade and development.
Arguments Against
The designation relies on granting specific tax advantages to certain geographic locations, potentially distorting competition with businesses situated just outside the designated 'special tax sites'.
The mechanisms depend on meeting conditions under the Capital Allowances Act 2001, which may create complexity and administrative burdens for businesses seeking to claim enhanced allowances.
Fiscal policies focused on localized tax benefits may divert investment from other areas that do not benefit from freeport status, necessitating detailed public scrutiny of the overall economic benefit.
The Treasury make these Regulations in exercise of the powers conferred by section 113 of the Finance Act 2021.
The areas designated by these Regulations are either situated in a freeport or considered by the Treasury as being used, or likely to be used, for purposes connected with activities carried on, or likely to be carried on, in a freeport.
The Treasury created these Regulations using the legal authority provided by section 113 of the Finance Act 2021.
The designated areas must either be inside a freeport or be related to activities happening or expected to happen within a freeport area.
Citation, commencement and interpretation1.
(1)
(2)
In these Regulations, a reference to an area “shown edged and hatched in red” on a map is a reference to the hatched area extending up to the red edging, but not including the red edging itself.
The first section provides the official title: The Designation of Special Tax Sites (Anglesey Freeport) Regulations 2025.
These rules become legally effective on November 21, 2025.
It also clarifies that when maps describe an area as 'shown edged and hatched in red,' it refers only to the hatched part up to the boundary line, excluding the red line itself.
Designation of special tax sites2.
(1)
The following areas are designated as special areas for the purposes referred to in section 113(1) of the Finance Act 2021—
(a)
the area shown edged and hatched in red on the map entitled “North Anglesey Tax Site: Octel” and dated 15th May 2024;
(b)
the areas shown edged and hatched in red on the map entitled “North Anglesey Tax Site: Rhosgoch” and dated 15th May 2024.
(2)
The designations made by paragraph (1) take effect on 21st November 2025.
This section officially designates the specific locations within the Anglesey Freeport that qualify as 'special areas' to receive the tax benefits mentioned in the Finance Act 2021.
The designated areas are identified by reference to two specific maps: one titled 'North Anglesey Tax Site: Octel' and the other 'North Anglesey Tax Site: Rhosgoch,' both dated May 15, 2024.
Paragraph (2) confirms that these specific designations begin on November 21, 2025.
Explanatory Note
(This note is not part of the Regulations)
These Regulations designate areas, known as “special tax sites”, as special areas for the purposes of Parts 2 (plant and machinery allowances) and 2A (structures and buildings allowances) of the Capital Allowances Act 2001 (c. 2) (“CAA 2001”).
Section 45O in Part 2 of CAA 2001 provides that expenditure incurred by a company on the provision of plant and machinery for use in a special tax site qualifies for enhanced capital allowances if certain conditions are met.
Section 270BNA in Part 2A of CAA 2001 provides that expenditure incurred on non-residential structures and buildings situated in a special tax site qualifies for an enhanced annual rate of structures and buildings allowances if certain conditions are met.
A Tax Information and Impact Note covering this instrument was published on 3rd March 2021 alongside Spring Budget 2021 and is available on the website at: https://www.gov.uk/government/publications/designation-of-freeport-tax-sites/designation-of-freeport-tax-sites. It remains an accurate summary of the impacts that apply to this instrument.
The Explanatory Note, which is not legally part of the Regulations, clarifies that designating these 'special tax sites' activates enhanced capital allowances under Parts 2 and 2A of the Capital Allowances Act 2001.
Specifically, expenditure on plant and machinery (Section 45O) and non-residential structures and buildings (Section 270BNA) within these sites may qualify for higher rates of allowance, provided other statutory conditions are met.
A related Tax Information and Impact Note from March 2021 summarizes the expected financial effects of this policy.
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