What are Capital Allowances?

A capital allowance is the unit used by HMRC to measure depreciation (wear and tear) of an asset. The current legislation governing the use of capital allowances is the Capital Allowances Act, 2001. Commercial property owners are allowed to claim capital allowances on inherent plant & machinery within their commercial buildings as a statutory exemption.

Our experience of reviewing potential clients financial statements is that one of the largest and most obvious assets, being property, is often overlooked for claims allowed within the Taxes Act. We describe a property to our clients as a structure in which integral features pulse.

Buildings contain such functions as heating, lighting, lifts, roller shutter doors, air conditioning systems and the like, all of which can yield perfectly legitimate tax claims which are so often overlooked.

It is sometimes the elephant in the room that is ignored and yet the tax efficient benefits can be substantial. It is being awake to these opportunities that allows us to provide a strong service to our client base.


On average, a capital allowances claim undertaken by us results in you receiving a tax saving related to your portfolio’s purchase consideration. The value of the tax saving is affected by the types and sizes of buildings being claimed upon as well as the effective tax rate of the legal owning entity.

Any business or individual owning, building or refurbishing commercial property can gain significant value from claiming capital allowances.

The value of capital allowances varies according to the nature of the property and are typically relevant for buildings such as:

  • Office Buildings
  • Industrial Buildings
  • Hotels and pubs
  • Care homes and Supported living premises
  • GPs, dentist and physiotherapy practices
  • Retail units
  • Furnished Holiday Lets

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