Business Premises Renovation Allowances

This is intended to encourage urban regeneration and is available for expenditure incurred on the renovation of business premises to bring them back into use.

Business premises renovation allowances provide a 100% initial allowance in the year the expenditure is incurred, or if it is preferred by the taxpayer, 25% per annum on a straight line basis. They are particularly valuable because all expenditure incurred qualifies, unlike commercial plant & machinery allowances.

Expenditure must be incurred on the conversion, renovation, or incidental repairs of a ‘qualifying building’ into a ‘qualifying business premises’.  The relief is not available for extensions (except to provide access to qualifying business premises); moveable plant and machinery; or property previously used, or to be used for the following trade sectors: fishery, ship building, the coal industry, synthetic fibres, the primary production of certain agricultural products and the manufacture and marketing of products which imitate or substitute for milk or milk products.

A ‘qualifying building’ is a building or structure situated in one of circa 2,000 specially designated disadvantaged areas across the UK, that was previously used for business purposes and has been vacant for at least a year.

A ‘qualifying business premises ’ is a qualifying building used for business purposes (that is, a trade, profession, or vocation) or as an office or offices (whether or not for business purposes).