Capital Allowances – what HMRC says

As with any type of tax or tax relief, if you’re not familiar with the subject, you might find it daunting.

At Complete Capital Allowance, we are here to simplify things for you.

Capital Allowances

Many commercial property owners and their advisors are unaware that, according to UK tax legislation, tax relief can be claimed on a portion of the purchase price relating to ‘embedded fixtures’ if the property is used for commercial or mixed purposes. 

These allowances cover expenditures on fixtures, fittings, and integral features within commercial buildings, such as heating systems, lighting, and security installations. Although often included in the purchase price of the property, these can be split out for the purposes of making a capital allowance claim. As a result, businesses can maximise tax savings and improve their overall financial performance.

A capital allowance is a tax relief for businesses, allowing them to deduct the value of certain items from their profits before paying tax to HMRC. While capital allowances do not result in direct cash refunds, they effectively reduce tax liabilities, freeing up more funds for business investment and growth. Importantly, capital allowances are available to businesses regardless of their structure or tax status.

HMRC details certain types of capital allowance claims on its website:

• Annual investment allowance (AIA) – you can claim up to £1 million on certain plant and machinery.
• 100% first-year allowances – you can claim the full amount for certain plant and machinery in the year that it was bought.
• The super-deduction or 50% special rate first-year allowance – you can claim these for certain plant and machinery you buy from 1 April 2021 up to and including 31 March 2023.
• Writing down allowances – you can claim these if your plant and machinery does not qualify for AIA or you’ve already claimed the maximum amount.

In addition, capital allowances may also be claimed on:

• renovating business premises in disadvantaged areas of the UK
• extracting minerals
• research and development
• ‘know-how’ (intellectual property about industrial techniques)
• patent rights
• dredging allowances
• structures and buildings

Now, you can either undertake time-consuming research on capital allowances and how to claim the tax relief you are eligible for, or you can contact Complete Capital Allowance and instruct our expert team to do it for you.

We have a 100% success rate on all claims we move forward with, and our fees are only payable upon successful submission.

Complete Capital Allowance – it’s all we do.