If you own commercial property in the UK, you are almost certainly eligible to claim substantial tax rebates from HMRC for past years, as well as continuing tax reliefs in the future.

However, the relationship between capital allowances and capital gains is often misunderstood, as is the difference between the accounting and tax treatment of a property. Claiming capital allowances does not adversely affect your capital gains tax position on resale.

Eligibility

There are an estimated two million properties that do qualify:

• The property is classified as commercial (e.g. shop, office, factory, warehouse etc.)
• Is not held in a pension fund, the government, charity or treated as stock.
• The purchase price was at least £200,000
• The owner is a UK taxpayer - could be an individual, an LLP, a PLC or a Ltd company.

If you satisfy these four simple criteria, it is highly likely you will have a genuine and significant claim to make.

This is were the claims arise

Many distinctions are obvious: clearly office furniture is movable and the roof is immovable. But what about air-conditioning plant, emergency lighting and alarm systems? These are normally considered by accountants as "improvements" which are immovable and not therefore eligible for capital allowances. But HMRC will agree otherwise - provided you approach them in the correct way, with the correct information presented in the approved manner.

Your accountants probably can't do it for you, but we add value by working with them to make a successful claim.

In fact there is a common misconception that claiming Capital Allowances on integrated plant and machinery reduces the base cost for CGT. This is not the case - in effect, the owner gets double relief on the value of the integrated plant and machinery.