Tax relief on buildings

I have just had a storage unit built for my business. Can I offset the cost of the building against my profits?

1st May 2013

In short and as a general rule, the answer is no. Tax relief on assets, usually comes in the form of Capital Allowances. However, Capital Allowances are generally not available for expenditure on land or buildings. Tax relief on the cost of land and buildings is instead obtained via the Capital Gains Tax regime when the asset is sold.

However, you may be able to claim some Capital Allowances on certain expenditure on certain buildings, such as:

  • Fixtures and equipment in the building such as some kitchen equipment,
  • Features “integral” to the building such as lighting systems; and
  • Thermal insulation

But there are some very complex rules and conditions attached to qualifying for such Capital Allowances, so I would strongly advise you to seek professional advice to ensure you do not under or over claim. Your local TaxAssist Accountant can advise you on Capital Allowances and prepare your claim for you. Please feel free to contact us for more information or your free initial consultation.

By Jo Nockels

Disclaimer: The information provided is based on current guidance (at date of publication) from HMRC and may be subject to change. Any advice shared here is intended to inform rather than advise. Taxpayer's circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this information, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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