Capital allowances on UK property purchases

Philip Spencer

Melissa Malins

Speed read

The capital allowance regime offers a number of opportunities for property businesses to mitigate their tax liabilities. Certain tax credits which are available for loss-making corporate entities and exchanged for the surrender of losses can make a positive impact on cash flow, but should be considered in conjunction with carrying forward those losses instead. When purchasing a property which is already in commercial use, no elections or contracts should be signed before tax advice is obtained and the capital allowance position correctly ascertained. Rules around previous owners and interests acquired can be complex. It is never too late to claim allowances on historic expenditure.

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