Is your business operating in a premises which you own and originally purchased from someone else? There’s a good chance that you are entitled to some unclaimed tax benefits. These are typically worth thousands of pounds, in cash, to you.
The key to realising these benefits is to a) identify the value of “embedded fixtures” – electrical and heating systems, kitchens and bathrooms – contained within your property and b) confirm that they haven’t previously been claimed for.
Does your the property purchase agreement not explicitly identify and value such assets? This can be checked if a clause referred to as “section 198 election” is included. We will be able to secure significant tax benefits which would otherwise go to waste.
As a very rough guide, see if these numbers are of interest to you (benefits would scale up or down as the property value changes):
| Assumed property value | £500,000 | |
| Illustrative value of embedded fixtures in that property | £40,000 | Specialist surveying and tax skills required to identify these |
| Extra gross tax benefit to you as a limited company | £7,600 | Will be significantly more if you are a sole trader |
| 4% fee to identify embedded fixtures value | £1,600 | VAT will be added, but note that this cost is tax deductible |
| Net benefit to you as a limited company | £6,000 | Minimal effort required on your part to secure this |
Having identified the value of the embedded assets, it’s possible to:
- immediately reclaim tax already paid in previous years
- reduce the amount of tax payable on your next tax return
- or carry forward the benefits for future years
We will be able to show you the different pros and cons arising from each of these approaches and advise which is best.
If you’re paying at least £1,500 in tax annually and your property has a minimum value of £100,000 please contact us now on 0118 934 9487 to secure these benefits.
