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  • Michael Brownsdon

    Partner, Capital Allowances
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Capital Allowances on Commercial Property 

Capital allowances are the only form of tax relief claimable on capital expenditure incurred by UK taxpaying owners and occupiers of commercial property. Used to offset UK tax otherwise due on income, capital allowances help profitable business save money as well as encourage investment. Businesses who fail to have a capital allowances recovery strategy unnecessarily overpay tax on a regular basis.

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Capital Allowances Advisors

Capital allowances on commercial property expenditure are rarely maximised due to ever-changing tax legislation and the inherent requirement for specialist property valuation and building construction expertise. Our proven multi-disciplinary approach, combining our specialist skills and established dialogue with both HMRC and the VOA, ensures that our clients’ position is always truly maximised.

As strategic property advisors, Knight Frank has to understand clients’ property requirements in the widest context. By being at the forefront of the property-related decision making process, we can integrate our dedicated team early in each project, ensuring all expenditure is correctly planned and combining our specialist skills to maximise the various tax reliefs available.

Our specialists Capital Allowances Consultancy Team are able to provide a high quality service to investors, owners and occupiers of freehold or leasehold commercial property. We provide capital allowances advice on acquisitions and disposals of new and second hand assets, as well as on property developments, alterations, refurbishments and fit-outs.

FAQ:

What are UK Capital Allowances?

Capital Allowance advisers Knight Frank can help you decipher this often confusing tax relief for businesses. Find out if you're eligible to claim and how much rebate you may be owed.

Explain Capital Allowances to me in the simplest terms

• The only form of tax relief available for capital expenditure incurred buying, building or refurbishing a commercial property.

• Generates significant tax reductions and or repayments, creating considerable cash flow advantages.

Doesn’t my accountant or tax advisor deal with that?

• Non-specialist accountants and tax advisors will claim some allowances, but the values are rarely maximised.

• Knight Frank offers an ‘overage’ valuation, where we identify all allowances which have been overlooked.

 Am I eligible to claim?

  • Yes, provided you meet all three requirements below
  • You have incurred capital expenditure: The basic rule is ‘don’t spend, don’t get’. Your expenditure can be on: purchases, fit-outs, refurbishments, extensions, new builds or conversions.
  • You hold an interest over the property. Freehold, leasehold or licence to occupy.
  • You are a UK taxpayer: Your business is subject to income orcorporation tax.

 But I bought my property a long time ago, can I still claim?

  • Yes, you can claim on expenditure as far back as you wish, provided you still own the asset.

Will a capital allowances review take up a lot of my time?

  • No! We require only basic information from you, such as the contact details of your lawyer, accountant and property manager. Then we do all the work.

Will it be expensive?

  • Not at all. Knight Frank Capital Allowances work on an incentivised ‘no win, no fee’ basis, whereby our fee is a small percentage of the allowances we identify.

Finance Act 2012:

Capital allowances requirement when buying/selling Finance Act 2012, imposed a new compliance requirement regarding capital allowances. All allowances which are not valued and pooled prior to sale will be lost forever, including for all future owners of that property. Capital allowances are not an integral part of all property transactions. They must now be addressed in all purchase contracts and can affect property values.

Get in touch to see how we can save you money on your tax bill or for help and advice on understanding Capital Allowances

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