Are you aware of capital allowance tax relief?

Just under half of SME businesses that own a commercial property have not been alerted to ‘Capital Allowances’ tax relief by their accountants.

Two in five UK SMEs (39 per cent) that own their own business premises are unaware that they can claim a valuable form of tax relief called ‘Capital Allowances’, according to a survey published today by Catax, the specialist tax reliefs expert.

Capital Allowances are a tax relief available on the ‘intrinsic fabrication’ of a commercial property, such as an office, surgery, warehouse, B&B or other business premises. Qualifying items typically include pipework, cabling, heating, lighting and air conditioning, security and communication systems.

The Catax survey of 500 SME business owners and senior managers reveals that nearly half (46 per cent) of everyday companies that own their own business premises have never had capital allowances brought to their attention by their accountants.

Since launching, Catax has secured over £102 million of Capital Allowances tax relief for over 8,000 clients. In its experience, nine in ten commercial property-owning businesses have never made a claim and the average net tax benefit to businesses is a significant £46,000.

Typical small and medium-sized business clients of Catax include:

  • Bars, restaurants and fast food outlets
  • Veterinary, GP and dental surgeries
  • Nurseries
  • Hotels and B&Bs
  • Car dealerships

It has become more important than ever for commercial property owners to have Capital Allowances on their radars: since 2014, any unclaimed Capital Allowances must be identified and documented before, or when, a commercial property is bought or sold — or could be lost forever.

Mark Tighe, CEO, Catax, comments, ‘There are hundreds of thousands of everyday businesses around the UK, from veterinary, dental and GP practices to nurseries, bars and B&Bs, that are sitting on a potentially significant tax windfall. Capital allowances are obscure at the best of times but they can be extremely lucrative when identified, with the rebate usually received from HMRC in the form of a cash lump sum and ongoing tax relief. In fairness to accountants, this area of taxation is highly specialist so if even they are struggling to get to grips with Capital Allowances then it’s no surprise most companies are completely in the dark.’

Further reading on capital allowance tax relief

Owen Gough, SmallBusiness UK

Owen Gough

Owen was a reporter for Bonhill Group plc writing across the and titles before moving on to be a Digital Technology reporter for the

Related Topics

Capital allowance
Tax relief

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