Whether you are an owner occupier or an investor purchasing an existing second-hand property the same principles apply. The amount you can claim is largely dependent on the tax history of the property and what claim the seller, or a former owner, may or may not have made.
Establishing Available Allowances
Therefore, at pre-contract stage it is important to establish the level of available allowances. Most conveyancing solicitors use the British Property Federation endorsed standard commercial property pre-contract enquiries (CPSE.1).
Calculating your Claim
The claim process itself involves the combination of our tax and surveying skills. First, we fully survey the property to establish and back up by photograph the items to be claimed as plant.
The amount of plant and machinery claimed is then based on a just apportionment of the purchase price. The land, buildings, and plant and machinery are all valued, and using an approved HM Revenue methodology, the qualifying plant and machinery figure is calculated.
This detailed, fully disclosed and referenced claim report is available to support the capital allowances claim in the tax computation for the period in which the property was acquired.
It is still possible to claim capital allowances on acquisitions retrospectively.
As long as there is sufficient information available regarding the purchase and the property is still owned in the period in when the claim is made, then a claim can still be submitted. However, even if you cannot find all the paperwork to prepare and support your claim, our specialist skills mean we can often proceed successfully without this, and we are highly experienced at doing so.
In some cases, this can be done on acquisitions more than 10 years old.
There is no time bar on claiming for money spent to buy or build property before April 2012. However, from April 2012 new rules apply to sales and purchases of second-hand property. These impose a broadly two-year time limit upon buyers where the seller has previously claimed capital allowances.
The rules will be tightened from April 2014 to apply even where the seller has not claimed any allowances, but could have done. Therefore, we strongly recommended speaking to us sooner, rather than later.