If you own or invest in commercial property you are more than likely sitting on huge amounts of working capital waiting to be put back into your business.
By utilising capital allowances actual cash can be realised, tax liabilities dramatically lowered and increased cash flow can ensure future stability and growth.
Overview of Capital Allowances
Capital allowances are sums of money a business can deduct from its net profits in order to reduce tax and are gained by valuing plant and machinery within the building. Items of qualifying plant include electrical and lighting installations, heating and ventilation systems through to fire and security alarm configurations, data and telecoms installations and more. A full list of qualifying plant and machinery can be found in the Capital Allowances Act 2001, Section 23, List C.
Commercial properties that qualify range from offices, care homes, industrial/warehouse units and retail outlets through to holiday lets, serviced accommodation and apartment blocks.
Capital allowances can be obtained from commercial property purchase, refurbishment and new build expenditure and in most cases there is no time limit as to when the expenditure was incurred.
Recent Claim Completed - 25th March 2020
A recently completed capital allowances claim on a gym purchased for £850,000 in 2010 yielded the owner £297,500 in tax free income. This is calculated as follows:
18/19 Tax Year - £17,851 Tax Credit
19/20 Tax Year - £15,172 Instant Tax Saving
Future Tax Relief Remaining - £85,977
Our client had set aside £40,000 for his 19/20 tax liability but due to capital allowances this was reduced to £6,977 resulting in an instant cash injection of £33,023 for his business.
We offer a free capital allowances audit to all clients with no upfront fees, charges or commitment.
James Nazir & Co
Capital Allowances Specialists (UK & EEA)