Who is entitled to these Taxable Benefits?
A Company or Individual that carries on a ‘qualifying activity’ and incurs ‘qualifying expenditure’. The following two very simple prefaces are set out in the Capital Allowances Act 2001 section 11. A qualifying activity can be a trade, profession or property investment. Qualifying expenditure is simply the capital expenditure of the provision of plant and machinery.
What is Plant and Machinery?
In this respect the statute we are given no definition, indeed to HMRC inspectors manuals confirm this vagueness (CA21100).
In light of definitive statutory guidance we are left to find our way with case law precedents. The first of which dates back to 1887. Yarmouth v France ‘whatever apparatus is used by a businessman for carrying on his business. All goods and chattels, fixed or movable, live or dead, which is kept for permanent employment in the business’.
The area that we consider specifically relates to where items cease to become solely setting and provide a function. However, these are part of the property so are commonly missed or overlooked due to their very nature.
For example, a suspended ceiling is setting on a building. If that same suspended ceiling houses part of the air conditioning units or ducting it takes on functionality. Therefore qualifies as plant and machinery. Similarly a floor is structural and quite clearly the setting of a property. It is specifically excluded under CAA2001 Section 21 Table A. Although in the case of a non-slip floor in a toilet, this excluded item qualifies as plant and machinery due to the flooring having a function.
What We Do
Our remit is to identify these overlooked items within a commercial property without a paper trail or lack of detailed knowledge of the legislation.
These items are identified by an onsite detailed professional survey. This is confirmed by a technical review, case law precedents cross referenced to the historical legislative changes before being valued at the date of the expenditure.
A full detailed report prepared from the professional survey is submitted to HMRC. This supports your claim for additional capital allowances to offset against taxation paid and due.
The result of this exercise can generate a repayment of tax paid. It will also reduce income/corporation tax over the coming years.
5 December 2023
Capital Allowances ManualCapital allowances play a significant role in taxation. Allowing businesses to claim deductions for the depreciation of their assets. Among these assets, plant and machinery are frequently mentioned. However, the term “plant and machinery” is not explicitly defined in tax law. It should also...
22 November 2023
Autumn Budget 2023: Changes to Capital AllowancesThe Autumn Budget of 2023 has arrived, and with it comes significant changes and developments the government has put in place. Chancellor Jeremy Hunt delivered the statement on Wednesday, 22 November 2023. For businesses and individuals alike, these adjustments in tax policies can have far-reaching implications.
Our expert team are here to help answer any of your capital allowances questions or enquires you have about your commercial property.