Capital allowances

Capital allowances provide tax relief on assets that you buy and keep to use in your business.

The amount of relief you can claim each year depends on the nature of the assets that you buy, with rates varying from 8-100%. To make things more complex, capital allowance rates and the list of qualifying assets change over time.

To make the most of capital allowances when your capital expenditure is likely to be substantial, or when buying a property, it is vital you seek professional advice before you complete the purchase. Planning ahead will ensure your purchase is timed to maximise the amount of relief you can claim.

Our tax experts will guide you through the steps you need to take and the documentation you need to keep to ensure your capital allowance claim is successful in future tax returns.

Property transactions

While buildings, such as offices and factories, themselves don’t usually qualify for capital allowances, the cold water systems, electrical systems and air cooling or purification systems within these buildings do. The value of these capital allowances can be very substantial.

Building expenditure that does not qualify will usually only become available for tax relief against capital gains when the asset is sold.

If you are buying a commercial property, it is paramount that you determine and document the seller’s capital allowance position and agree on the value of the fixtures with the seller. This ensures your capital allowances are preserved.

Why choose WMT capital allowance advice?

We have a great deal of experience in capital allowances, having advised on the purchases of a wide range of assets in many different industries.

Get in touch with our tax team to find out more about how we can help you.