Tax relief on capital improvements

Growing and improving a business is an expensive process particularly when the cost of materials and labour are affecting capital projects nationwide. Maximising the tax relief in connection with capital expenditure projects can help offset the cost of these works and enhance the commercial viability of the project.

This article aims to provide a detailed overview of the allowances available on capital spend the considerations when preparing a claim and the relief the taxpayer might expect to receive.

Basics – who can claim

Capital allowances are available to companies partnerships and individuals alike if their profits are chargeable to UK corporation or income tax. Specific entitlement conditions and restrictions apply to the various allowances available.

To claim capital allowances the entity or individual needs to own the asset or use it for the purposes of a qualifying activity. A qualifying activity is any kind...