These Regulations may be cited as the Designation of Special Tax Sites (Flintshire and Wrexham Investment Zone) Regulations 2025 and come into force on 21st November 2025.
The Designation of Special Tax Sites (Flintshire and Wrexham Investment Zone) Regulations 2025
Published: Thu 16th Oct 25
These Regulations, enacted by the Treasury under powers from the Finance Act 2021, officially designate specific areas in Flintshire and Wrexham as 'special tax sites' effective from November 21st, 2025, based on their location within or connection to the designated investment zone; this formal designation qualifies expenditure on plant, machinery, structures, and buildings within these sites for enhanced capital allowances under the Capital Allowances Act 2001.
Arguments For
These regulations implement statutory powers granted by section 113 of the Finance Act 2021, providing a necessary legal framework for establishing investment zones.
Designating specific geographical areas as "special tax sites" enables businesses operating within them to benefit from enhanced capital allowances for plant, machinery, structures, and buildings, potentially stimulating economic activity and investment in Flintshire and Wrexham.
The clear demarcation using maps ensures that businesses and investors have certainty regarding the precise boundaries qualifying for these tax incentives.
Arguments Against
The policy relies on territorial tax incentives which critics argue can distort market competition by favoring specific geographic locations over others.
Implementation requires significant administrative oversight to verify that expenditure qualifies under the conditions set out in the Capital Allowances Act 2001, potentially creating compliance burdens for businesses.
The designation relies on the overall economic strategy of investment zones, which may be vulnerable to changes in future government policy or economic conditions.
The Treasury make these Regulations in exercise of the powers conferred by section 113 of the Finance Act 2021.{}
The Treasury is creating these statutory rules using the authority granted to it by Section 113 of the Finance Act 2021.
The areas designated by these Regulations are either situated in an investment zone 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 an investment zone.{}
The geographical locations established by these rules must either be inside a defined investment zone or be judged by the Treasury to be related to the activities that occur or are expected to occur within that investment zone.
Citation, commencement and interpretation1.
This is Section 1, which sets out the official title of the Regulations, when they become law, and definitions for terms used throughout the document.
(1)
The official title of this legislation is the Designation of Special Tax Sites (Flintshire and Wrexham Investment Zone) Regulations 2025.
The rules officially take legal effect on November 21st, 2025.
(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.
This clause defines how boundaries shown on official maps are to be interpreted for the purposes of these rules.
The designation applies to the area marked with red hatching, stopping right before the red line border, but the red line itself is excluded from the designated site.
Designation of special tax sites2.
This is Section 2, which formally names and identifies the specific geographical locations being designated as special tax sites.
(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 areas shown edged and hatched in red on the map entitled “Deeside Special Tax Site” and dated July 2025;
(b)
the area shown edged and hatched in red on the map entitled “Warren Hall Special Tax Site” and dated 28th July 2025;
(c)
the areas shown edged and hatched in red on the map entitled “Wrexham Industrial Estate, Special Tax Site” and dated 28th July 2025.
This subsection formally names the areas that qualify as special areas under Section 113(1) of the Finance Act 2021.
These areas include specific parts of Deeside, Warren Hall, and the Wrexham Industrial Estate, identified by associated dated maps bearing red hatching.
(2)
The designations made by paragraph (1) take effect on 21st November 2025.
The official status of the sites as designated special areas, as listed in subsection (1), begins on November 21st, 2025.
Two of the Lords Commissioners of His Majesty's Treasury 14th October 2025
This section records the signatures of the two Lords Commissioners of His Majesty's Treasury who authorized these Regulations on October 14th, 2025.
Explanatory Note (This note is not part of the Regulations)
This concluding section provides context and a summary of the regulations' effect; critically, this note itself does not hold the force of law.
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”).
These rules formally name specific geographical locations as 'special tax sites.' This designation brings them under Parts 2 and 2A of the Capital Allowances Act 2001, governing relief for capital spending on plant, machinery, structures, and buildings.
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.
Under Section 45O of the CAA 2001, companies installing plant and machinery for use within these newly designated special tax sites can become eligible for increased capital allowances, provided specific criteria are satisfied.
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.
Furthermore, Section 270BNA of the CAA 2001 allows businesses to claim a higher annual allowance rate for expenditure on new, non-residential structures and buildings constructed within a special tax site, again subject to meeting defined conditions.
A Tax Information and Impact Note covering this instrument was published on 15th March 2023, alongside Spring Budget 2023 and is available electronically at https://www.gov.uk/government/publications/investment-zone-special-tax-sites/investment-zone-special-tax-sites-with-enhanced-tax-and-national-insurance-contributions-reliefs. It remains an accurate summary of the impacts that apply to this instrument.
An official explanatory note detailing the expected tax and financial implications of this measure was initially released on March 15th, 2023, alongside the Spring Budget 2023, and it still accurately reflects the impacts of these regulations.
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