Capital Allowances – Commercial Property, Plant & Machinery
Whether you have purchased new commercial premises (freehold or leasehold), improved, or refurbished existing premises or have invested in Plant & Machinery, you could be entitled to significant tax relief on that expenditure in the form of Capital Allowances.
Calculated as a deduction from your annual profits, Capital Allowances reduce your Corporation (or Income) Tax liability and can massively impact the amount of tax that you pay. In extreme cases, this can even cancel a Corporation Tax Liability even when a profit has been recorded.
Is your business eligible?
Have you purchased or taken out a long-term lease on a commercial (non-residential) property at a cost of £300,000 or more?
Have you spent £100,000 or more developing a commercial property whether owned or rented?
Capital Allowances are available to any UK company, partnership or sole trader, who has incurred capital expenditure, usually through the acquisition of an asset (defined as an item with a useful life of 2 years or more). Theoretically, you could be a UK tax payer who owns commercial property in another country, and you may still be eligible!
A trade e.g., hotel, care home, manufacturer
A landlord who owns and rents out commercial property
Owners of a Furnished Holiday Lets in the UK or the European Economic Area
Owners of commercial property rented out abroad
The Process
1.1 Initial Discussion |
1.2 Initial Review |
1.3 Engagement |
| You will have a discussion with one of our specialist consultants to discuss your claim, the process and to let you know what information we require. | Our technical team will look at information provided by you – property information, accounting & tax records & public information | If a claim is possible, we will then proceed with a bespoke guide outlining your potential claim and issue an engagement letter so that we can start working with you on building the full claim. |
2.1 Information collection |
2.2 Survey of Property |
2.3 Technical Analysis |
|
A member of our team will be in contact to request any further information we may need. |
We will pre-arrange a date for us to visit and survey your property and work with you to ensure we maximise your claim. |
We will then use the valuations from the previous step and all other information to build your bespoke claim. We will be sure to look through and remove any items that do not qualify or have already been claimed by your accountant. |
3.1 Claim summary & tax Work |
3.2 Claim submission |
3.3 Final Report |
| Our technical analysts will ensure all qualifying items are built into your claim and that you are aware of the best approach for your tax. | Where possible we will amend your tax returns and resubmit them to HMRC. We do this in house and we maintain direct communication with HMRC on your behalf. | Once the claim has been completed we will issue a copy of the report to yourself & your accountant |
Whether its your or HMRC that have any questions, we will be here to assist with any questions.
We also offer a variety of other services that you may be eligible for, we will work with you to ensure you are in the optimal tax position.
To start your initial assessment, please click the “start a claim” button below and complete the short questionnaire
How much can your business claim?
Typically, capital allowances offer relief over time to reflect the life of the asset purchased. However, a suite of enhanced and accelerated allowances, intended to encourage capital investment in the UK, often allow for significant spend to be offset immediately as a first-year allowance.
The enhanced and accelerated allowances include a 130% super-deduction and a 50% first year allowance, both of which were introduced from April 2021. As per our simple illustration below, capital allowances reduce the amount of tax payable on your profits, releasing cashflow for further investment back into your business.
Illustration | Without Capital Allowances | With Capital Allowances |
Profit Before Tax | £2,500,000 | £2,500,000 |
Capital Allowances | £0 | £1,000,000 |
Taxable Profit | £2,500,000 | £1,500,000 |
Corporation Tax Payable @ 25% | £625,000 | £375,000 |
Saving £350,000
What assets qualify for capital allowances?
From shops to offices, hotels to restaurants, care homes to medical practices, Capital Allowances can be claimed on items that are kept for use within most types of businesses, which include (but are not limited to):
Examples of Plant & Machinery | Examples of Integral Features |
Computer equipment and servers | Solar panels |
Tractors, lorries, vans | Lifts, escalators and moving walkways |
Ladders, drills, cranes | Electrical systems, including lighting & fire safety systems |
Office chairs and desks | Hot and cold-water systems |
Electric vehicle charge points | Air-conditioning and air-cooling systems |
Refrigeration units | |
Compressors | |
Foundry equipment |
It is not only the cost of the item which may be claimed but also the cost of installation and other associated costs which can be attributed to their installation e.g., design fees.
Make a new claim with Blue Commercial
Providing the tax, surveying and legal know-how, our leading team of experts work with you to identify allowances that might otherwise have been missed. While your accountant may capture the allowances on more routine spend, property purchases and significant projects of improvements involve additional complexities and obscurities, which is where we come in, to unlock the full potential of the tax relief available to you.
Our Products
Energy Reclaims
UK businesses can claim up to 80% of all energy bills whilst using brokers going back as far as the year 2000.
Have you overpaid?
Energy Reclaims
It’s estimated that 80% of businesses have overpaid on their energy contracts
As most energy contracts do not disclose the brokers fee, UK businesses can claim up to 80% of all bills and contracts whilst using brokers going back as far as the year 2000.
We claim from the energy supplier, not the broker meaning our claims are 2-3 times higher than our competitors. Our panel of solicitors charge the lowest fees on the market, and are capped at a maximum of 30%.
No win, no fee - see if your business qualifies
Research & Development Tax Relief
Claim up to 33.35% of eligible R&D spend on innovations and advancements in products, processes, services, and industry knowledge.
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R&D
Research and development (R&D) tax credits were launched in 2001 (updated in April 2023) to reward businesses for innovating and developing their products, processes or service.
It is a highly valuable incentive, that can provide substantial tax relief on eligible R&D expenditure. In certain circumstances you can claim up to 33.35% of a company’s R&D spend, which is recovered either as a reduction in Corporation Tax or a cash repayment for reinvestment in company growth or further innovation.
The government has a target to raise investment in R&D to 2.4% of UK GDP by 2027; R&D tax relief forms part of that goal by reducing the cost of innovation for UK companies.
Land Remediation
Introduced in 2001 (and updated in 2009), Land Remediation Relief enables businesses to claim corporation tax relief of up to 150% of the cost of cleaning up contaminated land or buildings.
Find out more
Land Remediation
Introduced in 2001 (and updated in 2009), Land Remediation Relief enables businesses to claim corporation tax relief of up to 150% of the cost of cleaning up contaminated land or buildings.
Qualifying costs include the remediation of contaminated land, removal of asbestos from buildings, breaking-out buried structures and the treatment of harmful organisms and naturally occurring contaminants such as Japanese Knotweed, radon and arsenic.
Relief can be available on developments, regeneration projects, fit-outs and refurbishments.
The time limit for retrospective claims is within 2 years of the end of the accounting period for which the qualifying expenditure was incurred.
Capital Allowances
Whether you have purchased new commercial premises (freehold or leasehold), improved, or refurbished existing premises or have invested in Plant & Machinery, you could be entitled to significant tax relief on that expenditure in the form of Capital Allowances.
Find out more
Capital Allowances
Have you purchased or taken out a long-term lease on a commercial (non-residential) property at a cost of £300,000 or more? Have you spent £100,000 or more developing a commercial property whether owned or rented? Capital Allowances are available to any UK company, partnership or sole trader, who has incurred capital expenditure, usually through the acquisition of an asset (defined as an item with a useful life of 2 years or more). Theoretically, you could be a UK tax payer who owns commercial property in another country, and you may still be eligible!
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