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Category Archives: Specialist

Embedded Capital Allowances can be claimed by various UK commercial property owners, and veterinary surgery owners are no exception. It may come as a surprise to some that vets could claim a great deal of tax refunds on their property simply due to the size of the property and the items inherent within the building.

The particular items that would qualify for a claim within a surgery are essential items without which the adequate treatment of animals would not be able to take place. Therefore, it is important for vets to claim the tax refunds they deserve on these important items, and further realise that these allowances are a right, not a privilege. The kind of items that would qualify may surprise some, and would include plumbing, electrical equipment, air conditioning, surgical equipment and more. These items are considered part of the building, and are often costly to run, which is why tax refunds can be claimed on them. If the veterinarian has been overpaying a great deal of tax, then it is crucial for them to claim back the money they deserve.

Aside from the tax refunds, there are further benefits to making a claim on a surgery. If a successful claim is identified, then this could positively impact upon the value of the property, which will benefit the surgery owner if and when they come to selling their property.

The process of making a claim is an easy and stress free one, with minimum input from the property owner and maximum output from us, the capital allowance specialists. On average, we find over £100,000 worth of allowances on every property, and we have a 100% success rate with having claims accepted by HMRC. This is a truly risk free exercise that could bring fantastic benefits to the individual veterinary surgery owner and their business.
One thing that many people find so impressive about veterinarians is their ability to know so much about such a wide range of animal anatomies. Having this knowledge spread across so many different types of animals is highly impressive. Of course even in their world many veterinarians chose to specialise down even further as they recognise that to treat certain aspects of animal ill health requires a highly specialised knowledge and of course specific resources to enable diagnosis and then treatment.

The same can be said when looking at matters related to taxation and that is especially true when considering how commercial property is treated for tax purposes. Research has shown us that a significant number of vets own the building they practice from, that could be owned by an individual, a partnership or in some cases as a limited company but whatever the structure the majority might be unaware of something called Embedded Capital Allowances. This legislation was enshrined in the 2012 Finance Act so is not a loophole, tax scheme or any form of tax avoidance – it is a form of tax relief for commercial property owners, based upon items that are considered part of the property. For veterinarian surgeries, this could include advanced electrical equipment, plumbing and specialist equipment that may be costly to run. In most instances around 25% of the original purchase price of the building would be identified as allowances, so if a building was bought at £500K there could be around £125K of identified allowances, which means if owned by 40% tax payers there is around £50K of allowances in the form of a tax refund and/or reduced future liability.

Many think their accountant will have already done something about it but very few have the specialised resources necessary – a chartered surveyor, quantity surveyor, chartered tax advisor and a deep understanding of the complex HMRC rules that apply. We have such a team here at Headley Meredith Associates. Similarly to a vet that specialises, we are focused on this area of tax management and have a team in place who can identify and quantify items within a building that qualify and then apply a complex HMRC formula to calculate exactly what allowances HMRC will accept. Plus, we have a 100% acceptance rate with having reports approved by HMRC.

What’s more we do all this on a contingent basis as far as fees are concerned so we charge nothing upfront, we carry out the necessary survey free of charge and only then charge a small percentage of allowances found if and when they are accepted by HMRC. This is a risk free exercise and can provide fantastic benefits for commercial property owners such as veterinarians. Like some vets we recognise that general skills are important but sometimes specialised skills can reap great rewards. The good news is that it costs absolutely nothing to find out.
Good news for holiday home owners! In these days of punitive stamp duty for buy to let owners and changes to mortgage requirements for those looking to invest in property, there is a tax benefit for holiday home owners that many are unaware of and few have taken advantage of.

If you own a holiday home or even a number of them and you pay tax on the income from those holiday homes in the UK then you could be missing out on a tax allowance that is enshrined in tax statute and yours by right – you just need to know how to quantify it. Providing your holiday home(s) is available to be let for at least 210 days per year and is actually let for at least 105 days per year then you could have a strong claim for Embedded Capital Allowances. As the name suggests these are items embedded in the property and forming part of its overall value when you bought it but that are able to be moved if necessary. It covers things such as radiators, heating systems, air conditioning, bathroom and toilet fittings, kitchens, security systems and much more.

Typically we would expect to find around 25% of the original purchase value of the property would be identified as allowable items which represents £125K of allowances in a £500K property which translates as £50K in tax refund and/or reduction in future tax liability to a higher rate tax payer. So it’s an exercise well worth doing.

You may ask “wont my accountant have already done this?” – the answer is almost certainly not. It’s a highly specialised area of tax statute and requires very specific knowledge of that area as well as a specialist team that includes a quantity surveyor, chartered surveyor and a chartered tax specialist. Very few general practice accountants have a team such as this and the job can’t be done properly without them.

We have the specialist team required working with us as part of our in house team and on a daily basis we are identifying allowances for our clients that are making significant differences to their tax liabilities both now and over the next few years. In most cases that includes a significant cash inflow immediately.

Best of all, it costs you nothing to find out. We can do a full review of your property on a totally contingent basis. In other words we only charge a fee if we successfully identify unclaimed allowances and those are accepted by HMRC  - our fee is 100% linked to a successful outcome. There is no upfront charge and you only pay once the benefit is confirmed. There is literally no risk to you.