Capital Allowances

Capital allowances are an important and effective way of reducing your Corporation Tax liability and can be claimed when capital expenditure is incurred on business assets. They provide a yearly writing down allowance of 18% or 6% depending on the expenditure incurred.

Many businesses are unaware that they are eligible to make a claim and so may be missing out on this lucrative tax saving opportunity. We work closely with our clients to ensure that they are claiming as much as they can.

How can we help?

Historic capital allowance claims on a property purchase

Many of our clients own commercial properties and have done so for a number of years. If they have never carried out a capital allowance claim, they could be sitting on a significant amount of unclaimed tax savings.

We work alongside specialists to assess these allowances and submit a claim to HMRC in a clear, approved format.

Refurbishment of a property

We assist clients who are carrying out refurbishment works by analysing their expenditure and ensuring that any claim is maximised. We will speak with contractors where necessary to ensure that any schedule of works is sufficiently detailed in order to make a claim

Structures and Buildings Allowance

From 29 October 2018, businesses have been able to claim the new Structures and Buildings Allowance (SBA) on qualifying construction costs. These costs do not qualify for capital allowances and would previously have not attracted any tax relief.  The SBA provides a 3% write off per annum up to a maximum of 50 years.

When reviewing your costs for capital allowance purposes, we will also review the eligibility for claiming the SBA and will look to maximise both claims where possible.

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Buying and selling properties

Since the pooling requirement came into effect in 2014, allowances in a property must be pooled if the new owner is to be able to make a claim in the future. This is important for those buying properties of course, but also for those selling as it could drastically reduce the price that a future buyer is willing to pay.

When a property is sold, any fixtures in the property must have a value attributed to them. If no work is done to arrive at that value, often a nil value is entered into the box on the relevant forms.

We like to work proactively with clients who are looking to buy or sell a property to ensure that the correct value is attributed. Often, this will involve a historic capital allowance claim. We then work with our client, whether they be the buyer or the seller, to ensure that the correct value is attributed so as to negotiate the best starting point with the other party.

Land Remediation Relief

Companies can claim 150% tax relief on qualifying costs incurred on remediation of contaminated land. We will carry out a review of the works completed to ensure that they qualify for the relief and make sure that invoices are sufficiently detailed so that we can maximise your claim.

If companies are loss making, these losses can be surrendered for a repayable tax credit.

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Service head

Natasha Spicer - ACA

Senior Manager

Natasha Spicer is a Senior Manager in Menzies Farnborough office specialising in business tax advisory services for SME businesses in the UK.