Steven Mugglestone

The more I learn, the less I know

Businesses need to act now to avoid missing out on £millions of unclaimed capital allowances:

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Businesses need to act now to avoid missing out on £millions of unclaimed capital allowances

If you have acquired a freehold commercial property in the last 15 years you may be sitting on a fortune in unclaimed capital allowances. McGregors have carried out a number of successful claims for clients and our staff are experts in capital allowances claims and will be able to assist you but action is required NOW!!

The Government has signalled the Death Knell for retrospective capital allowances claims. At present claims can be made going back several years and we have obtained large refunds of tax for clients. From 1 April 2012, you will only have a further 12 months to submit a Retrospective claim and then the window will be closed and any unclaimed allowances are lost for ever.

If you own a freehold commercial property you need to ACT NOW. Please contact us, and we will carry out a FREE assessment to determine whether a capital allowances claim is possible.

As outlined in many previous articles, many businesses are missing on a number of allowances and, in particular on millions of pounds in un-claimed tax allowances.

In our experience, most businesses whether they are sole traders, self-employed persons or partnerships, as well as companies and organisations liable for Corporation Tax have under claimed on capital allowances. Usually, this is due to a lack of expertise and understanding of the qualifying criteria, the time and knowledge of how to present the claim, and a reluctance to deal with HMRC.

In brief, you can claim capital allowances for what your business spends on certain assets that it owns and uses in the business, provided certain conditions are met. The aim is to give tax relief for the reduction in value of qualifying assets that you buy and own for business use by letting you write off their cost against the taxable income of your business.

For example, if you buy an asset – e.g. a car, tools, machinery or other equipment – for use in your business, you are not able to deduct the expenditure on that asset from trading profits, but you may, subject to certain conditions, be able to claim a capital allowance for that expenditure.

The area where most capital allowances are missed is where they are available for certain building-related capital expenditure such as property refurbishment and renovation. However, please note that in most cases, you will not be able to claim capital allowances against the purchase price of or other investment in land, buildings or property.

When assessing your business, some examples of expenditure that may qualify for capital allowances are as follows:

  • Certain fixtures and integral features in buildings – expenditure on sanitary ware, fitted kitchens and certain other fixtures in a building may qualify for plant and machinery allowances. Expenditure on certain integral features of a building – e.g. electrical wiring, cold water systems, heating and air conditioning systems, and lifts might also qualify.
  • Renovating business premises – capital expenditure on the renovation of business premises in designated ‘disadvantaged areas’ may qualify for BPRA (Business Premises Renovation Allowance.
  • Flat conversions – capital costs of conversion or renovation of empty flats above commercial premises might qualify for the flat conversion allowance.
  • Capital expenditure on research and development (including equipment used for research and development) – if you are a trader and your research and development (R&D) relates to the trade that your business carries on, and meets other conditions, it may qualify for research and development allowances.
  • Gifts of equipment to charity – if you donate used assets that have qualified for plant or machinery allowances to a qualifying charity or community amateur sports club, you may be able to claim plant and machinery allowances on any left-over written down value.
  • Equipment that you own and use in your business – tools, machinery, office equipment, computers, vehicles, pieces of plant and factory equipment.

Literally, millions of pounds are waiting to be claimed from the Treasury in previously unclaimed Capital Allowances. This is not a tax avoidance strategy. You have a legal right to claim these allowances.

McGregors Corporate work with a specialist dedicated capital allowance company who are able to carry out retrospective, current year, and new build capital allowance claims, both for individuals and companies in relation to commercial properties right across the commercial sector. Most retrospective capital allowance claims that we handle lead to a significant tax refund.

We enjoy an excellent relationship with the HMRC and we do not seek to replace your current accountant. Instead we seek to work with them to achieve the best possible outcome for you.

If you would like a review of your capital allowance position, particularly in relation to building or renovation of a commercial property please contact us.

Steven Mugglestone BA FCA
Finance Director Services
McGregors Corporate, Entrepreneurial Chartered Accountants and Business Advisers
…….Really good for your business

McGregors Corporate are a Member of Probiz Tax, providing Innovative Tax Solutions to Owner Managed Businesses.

T: 0845 519 5659                T: 0121 236 3317

Connect, call, talk, email, contact us, send a messenger pigeon and arrange a discussion, review and free meeting.


Written by Steven Mugglestone

January 30, 2012 at 6:08 pm

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