Embedded Capital Allowances Explained

If you have clients who are involved in buying or selling commercial property, then we know that you are likely to be aware of the changes brought about by the Finance Act 2012, which made certain changes regarding capital allowances in property at the point of sale.

As you’re probably already aware, the requirements of section 32 of Commercial Property Standard Enquiries form, aka CPSE 32, have unfortunately meant that many solicitors have been left in a situation where they are being asked to advise on areas of  tax law that they do not feel comfortable dealing with. As a result of this, many have simply referred it back to the clients’ accountant, which is a problem for the client since many general practice accountants do not have the particular resources or specialist knowledge our team possesses, and so are unable to fully help. This can leave the client at a significant disadvantage with poorly advised information that can prejudice their rights on this matter progressing.

We are aware that there is a worry that dealing with this matter could potentially over complicate and delay proceedings. However, the reality is that if action is taken to deal with this as soon as the instructions are given, especially when the information is more likely to be readily available from both vendor and purchaser, then it can be dealt with in a quick and effective way that benefits all parties involved.

All that is required is that a specialist capital allowances advisor is involved in the process and that they have a strong track record in carrying out all the necessary actions to set fixed value requirements as compulsory according to the Finance Act 2012, and thus give all information necessary in the election (s198 or 199). There is no reason why it should delay or over complicate the procedure, and it means the solicitor can carry out their responsibilities to their clients without having to get heavily involved or spend valuable time having to deal with it. Simply setting a fixed value at a nominal figure of say £1, can in fact cause issues, and in worse situations, could potentially expose the solicitor to claims of negligence in certain instances.

We specialise in capital allowances in property and we work with a range of solicitors and accountants to deliver the expert advice and services to make sure this matter is handled properly and to everyone’s advantage. If you bring us into this as soon as your client instructs you, we can ensure this matter will be handled with the least disruption to yourselves or the client.

I can, without hesitation, recommend the services of Headley Meredith Associates. They have provided me with a first class service and I have found them to be extremely thorough, informative and proactive throughout.

Carl HallFinancial Accounting Services Limited

The Claim Process

INITIAL FACT FIND

Here we identify the property details and start our enquiries with you to ensure that it qualifies for a claim. If you can ensure that your client responds to our queries quickly then this would greatly speed up the process. Our requests are never demanding, but relate to information only they are likely to hold. We will be looking at the type of property, when it was purchased and your clients’ tax rate.

CHARTERED SURVEYOR

We will then arrange for a member of our team who will be a qualified Chartered Surveyor to survey your clients’ property. Our surveyors have a great deal of experience in identifying and submitting Embedded Capital Allowance claims within commercial properties, and we can assure you that our surveyors will assess the property in a manner of upmost professionalism.

CHARTERED TAX SPECIALIST

Once our surveyor has completed their report our tax specialist will assess and quantify the level of allowances your clients’ property will qualify for. The specialist will prepare a detailed report for approval by yourself and additionally in a format acceptable to HM Revenue & Customs.

HMRC REFUND

We will work with you to help prepare your clients’ tax return to ensure the correct information is submitted. This then results in a refund of overpaid tax. This return also provides a template for future claims and tax returns.

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