Why you could be paying £000’s too much in taxPosted 2014 by admin
Owners of commercial properties, whether used in their own business or let to tenants could be sat on a tax goldmine and not even be aware of it.
What tax relief?
Experts estimate that property owners in the UK could be missing out on tax relief worth billions of pounds because no claims have been made for qualifying expenditure within the buildings that they own.
Claims may be made for items included in the structure of the building such as lifts, lighting, heating, air conditioning and sanitary fittings.
Typically, when a building is purchased new or second hand, no separate breakdown of these items is given and consequently no tax reliefs for them are claimed.
A claim can result in future tax savings, a cash rebate from HMRC or both.
How much can I save?
The tax savings are typically between 5% and 10% of money spent.
But surely my accountant has already dealt with this?
Not if our experience is anything to go by. For example, we have recently been instructed by several firms where it has immediately become apparent that no claims have ever been made by their previous accountants. Fortunately we were able to rectify this oversight and managed to obtain our client hundreds of thousands of extra tax reliefs.
Sadly, there does generally appear to be a lack of knowledge by many commercial property owners and their accountants that these reliefs even exist.
Have I left it too late?
There is no time limit for making a claim, but we suggest that action should be taken as soon as possible.
New rules that came into force on 1 April 2014 mean that these claims are now more important than ever. From that date, if you sell a commercial property and have not previously submitted a claim for capital allowances on that expenditure then the allowances available to the purchaser could be lost forever.
That could have a real impact on the price that a potential purchaser would offer you for the property.
So what should I do?
Don’t delay – Check your position by seeking professional advice from an accountant with knowledge in this area.
If you would like an informal initial talk about your own circumstances please contact one of our tax specialists resident in our Newbury office.