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Capital Allowances on Property

Capital allowances are a valuable form of tax relief available to anyone incurring capital expenditure buying or building commercial property. They significantly boost the post-tax yield on an investment.

Capital allowances and related reliefs are available when:

  • Commercial property is acquired for investment or occupation
  • Commercial new-build, extension or fitting-out/refurbishment works are undertaken
  • Business equipment is purchased
  • Contaminated land or buildings are cleaned-up
  • Research and development is undertaken, or R&D facilities are bought or built

Capital allowances are a tax adjustment only and have no effect on the profits shown in a business's financial accounts or on the market value of property.

Claiming capital allowances will not increase any capital gain if the property is ever sold.

Our services include:

  • Preparing and agreeing capital allowances claims to maximise tax savings:-
  • New build and refurbishment projects
  • Property acquisitions
  • Research & development tax relief and capital allowances.
  • Resolving HM Revenue enquiries into capital allowances claims
  • Enhanced capital allowances reviews to accelerate tax savings for energy-saving and water-conserving/quality-improving plant
  • Long-life asset reviews to minimise expenditure potentially qualifying for tax relief at a reduced rate
  • Evaluating and designing documentation and systems for efficient expenditure recording and reporting - ideal for owners of multiple similar properties (for example, retailers)

Thinking in advance about capital allowances can give you the upper hand, and generate additional tax savings.

We can provide:

  • Pre-contract enquiries and estimates of allowances
  • Acquisition and sale contract advice and negotiations
  • Entitlement reviews (to ensure a capital allowances claim is legally possible)
  • Advice on how to tax-efficiently structure financial contributions from third parties
  • Valuations and purchase price allocations for capital gains tax and stamp duty land tax ('SDLT') purposes, e.g. between land/fixtures and chattels/goodwill