What is a business?
There’s a question. In accounting terms, it is Assets + Equity – Liabilities. In the real world, it is people, customers, a place to provide a service, and lots of intangibles. When we look at a business we see all of that but we also see lots…of…stuff! Businesses need THINGS in order to offer a service or make a product. They need security systems to let the right people in and keep the wrong people out, they need a reception desk to greet them with a smile and they need a kitchen unit to make them a cup of tea. All of these things make premises fit for purpose and HMRC wants to motivate you to invest in your business property. That’s what Capital Allowances are for.
What are Capital Allowances?
Capital Allowances are a tax relief designed to incentivize business owners like you to improve their commercial properties. They have been around for decades and are a well-recognized part of the UK tax landscape. They are allowances that provide relief to tax for expenditure incurred improving a commercial property. Any item of expenditure which has an “enduring benefit” to the business can qualify for relief. From Gazebos to Garden Equipment to Grab Rails, you will be surprised at what can qualify for relief. “Embedded” Capital Allowances or “Property Embedded Fixtures and Fittings” are items that are part of the fabric of the building which are screwed in, bricked in, nailed in, and plastered in. They are items that are regularly missed by standard accounting practitioners and a could be a source of a considerable financial award for you!
Within a commercial property valued at £750,000, there may be as much as £240,000 in unclaimed Capital Allowances. For a property owned by an individual that equates to a tax refund or future saving of as much as £96,000.
Who can claim?
Almost all commercial property owned by an individual, partnership, or company will qualify for a capital allowance claim. If you own a commercial property and pay tax in the UK then you can claim. The kinds of properties which might have allowances built up within in them are:
Office Buildings
Hotels and Guest Houses
Pubs, Restaurants, and Bars
Care Homes
Retail and Industrial units
Dentists, Doctors and Vets Surgeries
Opticians
Holiday Lets
What can I claim?
Commercial Property owners will commonly miss a lot of items because they don’t have evidence of the cost, or they believe that the items won’t be eligible. You do not need to know how much you spent on improving your commercial property. Our expert surveyors are able to allocate costs to each item of expenditure using recognized costing breakdowns.
The kind of items that you might claim for are:
Emergency Lighting and Fire Detection Equipment
Fittings in toilets, baths, and showers.
Heating and Ventilation Systems
Air Conditioning
Kitchen Fittings and Catering Equipment
Hot and Cold Water Systems
Electrical Systems
Lifts
Suspended Ceilings and Partitioning
As a rule of thumb, you cannot claim for “First Fix” items in the very fabric of the building but items from “Second Fix” onwards and items included in further property improvements should always be checked to see if they are claimable.
How do I claim?
The first stage is to book an initial consultation which we can do in-person or online. We don’t do the hard sell; we just want to know as much as we can in order to help you as much as we can. We then speak to your accountant to gather some more information and then arrange for a surveyor to visit your commercial property. They gather information about the claimable items in the property and send that to a tax accountant to write a report which is sent to HMRC. Your claim is collected and sent to you less our success fee. The fee is 5% of the allowances that we identify for you. The process usually takes 8 to 12 weeks.
How do I get started?
Just contact us however you feel most comfortable and we will be in touch to get the ball rolling.
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