Whether a tenant or an owner-occupier, significant refurbishment or fit-out expenditure will qualify for Capital Allowances, reducing the net cost of a project by as much as 20% for companies or even more for individuals or partnerships.
What elements of a refurbishment qualify for the tax relief?
Contrary to common perception Capital Allowances isn’t restricted to just mechanical and electrical services; in some instances 100% of a refurbishment or fit out can now qualify for capital allowances, at differing rates.
From 1st April 2023, and for the following 3 years at least, 100% full expensing allowances can be claimed on plant and machinery including fixtures within leased buildings. This means that for every £10,000 spent on qualifying assets companies will be able to immediately reduce their tax liability by £2,500. There is no limit to the value of full expensing allowances claimed.
How to maximise the savings
Use a specialist Capital Allowances advisor and submit a fully disclosed and detailed Capital Allowances to HMRC. Not only are HMRC increasing their investigations into the basis of Capital Allowances claims but using a specialist will also help identify those allowances at a higher rate which are not broken down within contractor costs.