Millions of investors and business owners with UK commercial property holdings are sitting on large chunks of unclaimed tax relief – often worth thousands of pounds.
Because complex rules mean most people don't know what they can claim for, some 96 per cent of the five million business owners and leaseholders are missing out on capital allowances - tax relief available to commercial property owners on items bought for use within the business - according to tax adviser STax.
Capital allowances apply to spending on a car, tools, machinery, some office equipment, fixtures and fittings, charity donations and other integral office features. Capital allowances are often inaccurately assessed and processed by accountants, meaning the majority of businesses could be missing out on significant tax benefits, says founder Andrew Stanley.
He says individual claims can sometimes amount to as much as 35 per cent of the value of a freehold ie £350,000 of tax relief for a building bought for £1m.
“If you can accurately assess the items that qualify for the tax relief and processing an effective claim, it will result in a substantial write-off against the profits of your business, giving you a lower tax charge – and sometimes a cash rebate for previous years,” he added.
Need to know
Find details of what you can claim for on HMRC's website: www.hmrc.gov.uk/capital-allowances/basics.htm
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