CAPITAL ALLOWANCES SPECIALISTS
Capital Allowances advice for commercial property.
Identify qualifying expenditure, maximise available relief and stay compliant with HMRC — from property purchases and refurbishments to fit-outs, historical claims and enquiry support.
What are Capital Allowances?
Capital allowances can replace accounting depreciation for certain items of plant and machinery. Claiming them can reduce taxable profit and the amount of tax paid to HMRC.
Capital allowances are governed by legislation, and keeping compliant while maximising relief can be complex — specialist advice is essential.
Simon works alongside your existing advisors to provide specialist support, from tax planning and entitlement checks through to HMRC negotiations.
When are they relevant?
Whenever capital expenditure is incurred on qualifying assets within a commercial building, including:
You don't even have to be the freeholder. Where the expenditure is capital in nature and the items qualify, relief may be available.
Purchase
Construction
Fit outs
Refurbishments
Tenant works
What does this mean in cash savings?
Scenario A — advice before the project starts
A company leases a shell-and-core unit in a new development and seeks specialist capital allowances advice before works begin. During the project, the relevant information is gathered from the project team, including contract sums, variations, final account details and fixed asset ledgers.
Enhanced allowances can bring relief forward into the year the works are carried out, helping ease post-project cash flow.
Scenario B — advice after the first-year allowance window
The same works are reviewed later, after the period for claiming enhanced allowances has passed. The same level of allowances is identified, but WDA rates apply, so the cash benefit is spread over many years.
| Year | Annual cash saving Annual | Cumulative Cum. |
|---|---|---|
| 1 | £135,000 | £135,000 |
| 5 | £68,431 | £493,074 |
| 10 | £31,750 | £712,115 |
| 30+ | - | Relief continues over time |
Illustrative figures based on the example provided and subject to the company’s tax position.
What assets qualify?
Qualifying plant and machinery (P&M) falls into two categories.
General Pool
Written down at 18% per annum.
- Fixtures and fittings (e.g. kitchen units, shelving)
- Fire alarm systems
- Building management systems
- Sanitary installations
- Carpet
- Non electrical mechanical fittings (internal door locks)
Special Rate Pool
Written down at 6% per annum.
- General electrical installations
- Lighting
- HVAC
- Cold water
- Lifts
I purchased my property, can I claim?
Yes. When you purchase a commercial property, you purchase the right to claim for qualifying items.
Both freehold and long leasehold acquisitions can qualify.
Structural Building Allowances (SBA)
SBA can provide additional tax relief on qualifying construction costs of new non-residential buildings and major refurbishments.
- Applies to new builds and qualifying refurbishments
- Relief based on construction costs, not fittings
- Claimed alongside Capital Allowances
BEYOND STANDARD ACCOUNTING
Why use a specialist?
Miss one of these areas and valuable tax relief can be lost.
Tax Strategy
Navigating complex legislation including Full Expensing, Annual Investment Allowances, and specific capital/revenue distinctions.
Construction
Technical knowledge of building systems, M&E services, and architectural specifications.
Accounting
Integration with existing tax computations and forensic analysis of historical cost data.
Property Law
Managing s198 elections and complex contractual tax clauses during property transactions.
Discuss your portfolio with a specialist.
Secure an initial technical review of your property assets or upcoming construction project.
Get in touch