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Capital Allowances Incentives to Increase?

In a positive move to encourage capital investment Rishi Sunak announced in the 2022 Spring Statement plans to expand the Capital Allowances legislation, subject to a consultation process, to be formally announced in the autumn budget and to take effect from April 2023

23 Mar 2022

Written by: David Gibson

Veritas Contribute to UKAA Publication – Improving Returns on Build to Rent

As a member of The UKAA, we were pleased to be invited to contribute to their latest buzz news issue, in which we explain how investors-operators of build to rent can improve investment returns by claiming capital allowances

02 Nov 2021

Written by: Nolan Masters

Veritas Confirmed New Member of UKAA – The Organisation for the UK Build to Rent

Veritas Advisory have now been confirmed as a new member of UKAA, the organisation for the UK Build to Rent sector. 

18 Oct 2021

Written by: David Gibson

Archive

 

Latest News

Capital Allowances Incentives to Increase?

23 Mar 2022

In a positive move to encourage capital investment Rishi Sunak announced in the 2022 Spring Statement plans to expand the Capital Allowances legislation, subject to a consultation process, to be formally announced in the autumn budget and to take effect from April 2023

Veritas Contribute to UKAA Publication – Improving Returns on Build to Rent

02 Nov 2021

As a member of The UKAA, we were pleased to be invited to contribute to their latest buzz news issue, in which we explain how investors-operators of build to rent can improve investment returns by claiming capital allowances

Veritas Confirmed New Member of UKAA – The Organisation for the UK Build to Rent

18 Oct 2021

Veritas Advisory have now been confirmed as a new member of UKAA, the organisation for the UK Build to Rent sector. 

Veritas Supporting Charitable Causes

01 Oct 2021

We have chosen to support four charitable causes reflecting activities that are close to us and to people we know and would like to raise awareness of.

Using Artificial Intelligence for Capital Allowances

27 Sep 2021

Can Artificial Intelligence help claim capital allowances? In addition to preparing detailed claim reports for clients, Veritas Advisory, in partnership with Brunel University and Innovate UK, are applying technology to solve some of the issues, the main one being how to use data efficiently and correctly.

New Case Law – Potato Store is Plant

07 Aug 2021

JRO Griffiths Limited v The Commissioners for Her Majesty’s Revenue and Customs [2021] UKFTT 257 (TC) resulted in the taxpayer winning their appeal in whether or not a warehouse used to store potatoes for a crisp manufacturer is plant.  The taxpayer won on 2 counts.

Estates Gazette Article – Capitalise on Allowances

20 Jul 2021

Veritas Advisory Director Nolan Masters, together with Alex Barnes a Partner at BDB Pitmans LLP, have published an article in Estates Gazette on how capital allowances claims can mitigate the increasing cost of tax on property investment.

New Case Law – Satellites

16 Jul 2021

A Capital Allowances case Inmarsat Global Limited and The Commissioners for Her Majesty’s Revenue and Customs UT/2019/0167 V), has been refused by the Upper Tier Tribunal, in relation to the launch of satellites.

Taxation Magazine Article – The New Super Deduction

04 Jul 2021

In the June edition of Taxation Magazine Veritas Advisory Director Nolan Masters set out how the new super deduction and special rate allowances will affect property owners, occupiers and investors. Click here to read the article in full

At the recent annual conference for NARA (The Association of Property & Fixed Charge Receivers), Veritas Advisory set out the impact of the Capital Allowance changes brought in last year and explained the actions required when buying through receivers.

The rule change introduced by HMRC last April, now means that on disposal if any unclaimed Capital Allowances are not quantified with an election and pooled by the vendor, then the value of Capital Allowances is nil.

This presents a particularly difficult challenge in the case of buying property from receivership, where information and cooperation maybe in short supply.

The need to quantify the available Capital Allowances on disposal now requires the purchaser to ask the vendor, and potentially past owners, about the history of expenditure on the property and any prior claims for Capital Allowances.  Whilst the relationship between the vendor and LPA Receiver can be awkward, by employing an independent Capital Allowances advisor it can help to open up the dialogue with the vendors and their advisors.

Once armed with the answers, it then drives the next steps.  In some scenarios it maybe that the quantum is insignificant and this allows both parties to move on in agreeing the terms of the deal.

Once a material quantum is established by the Capital Allowances advisor then there is the need to elect over the benefit.  In our experience of working on such deals, it has been possible to obtain the cooperation of the receiver via the vendor, as by having a signed election it removes any tax impact on the vendor.

At the conference it was widely acknowledged that Capital Allowances should be marketed on sale to assist the deal and to achieve best value.  If however, cooperation is in short supply, then to agree a value the purchaser has the option of making an application to the first tier tribunal for an independent ruling.

The purchaser must however ensure that the position is adequately covered off in the drafting of the sale agreement.  This is not to penalise the vendor in any way, but rather to provide the purchaser with the ability to go to tribunal if a signed election is not forthcoming.

This option is likely to become increasingly used to agree the value of Capital Allowances and with a disinterested vendor the purchaser should be in the box seat.  This ruling will override the requirement to seek the vendor to satisfy the fixed value and pooling requirement.

Whilst the need to deal with Capital Allowances can be viewed as being in the too difficult box, the cash rewards, if pursued, can be significant and should in most cases not be ignored.