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Making the most of Capital Allowances

12/01/2010

During the current economic climate, managing cash flow is more important than ever. Tax, and more specifically capital allowances, on plant and machinery present in the structure of a building are often overlooked at the beginning of a construction project, but they can provide a significant cash flow advantage if the relevant claims are maximised.

Capital allowances can be claimed if the project is undertaken either by a company, partnership or as an individual. When the project is structured as an investment, e.g. the building is rented to another trading entity, then capital allowances will almost certainly still be available to the investor.

Watts is working with clients to review capital allowances claims of a scheme at feasibility stages of the design process, advising on increased tax efficiency, and identifying qualifying elements within the project documentation. This approach allows ease of tracking and early assembly of the claim.

The benefits:

  • They can generate significant income and corporation tax repayments
  • They allow tax relief on environmental improvements to the building
  • Allowances can be used as an incentive for future purchasers of the investment property
  • Claims can be made against historical expenditure

Watts has undertaken reviews of historic expenditure on client’s existing properties in this sector which have enabled capital allowance claims to be made generating significant tax repayments.

To read more about this service, our Capital allowances capability statement provides further information.

Alternatively please contact:

Manchester
Simon Brereton
T: +44 (0)161 831 6180
E: simon.brereton@watts-int.com

London
Neil Stevens
T: +44 (0)20 7280 8000
E: neil.stevens@watts-int.com

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