New roof required

New roof required

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Building needs new roof - slates need replacing. Battens and supports are ok, just slates being replaced.

Is this expense allowable as a repair??

Replies (11)

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By carnmores
30th Dec 2013 15:34

against what

rental income , has the property been let already

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By Cant Add Up
30th Dec 2013 19:24

Not rental it's a business property owned by the business owner.

 

 

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By User deleted
30th Dec 2013 20:22

As long as it is like for like ...

... I would put it as a repair, make sure you keep all invoices as HMRC may make an aspect enquiry on the repairs figure.

 

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By mhtax
30th Dec 2013 21:32

Be very careful

in your choice of materials and if using a different type get your builder to write a letter explaining that the slates chosen are not a better quality than tha existing ones.

I had an enquiry where the Inspector researched the new roof material used and was able to show a level of improvement which meant it was a capital expense.

 

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By zebaa
31st Dec 2013 11:29

Slates, tiles or something else

I would question what the fault was with the slates. As a roofing material slates tend to be long lasting and stable. Often it is the copper nails which corrode and allow the slates to slip and then the wind does the rest. I such a case the best thing is to replace the slates & re-roof - often with single lap concrete tiles as they are much cheaper. The slates usually are sold on or put into store to be reused. As the tiles are larger and slates are double lap you require roof lats at different spacing and places, thus you would also replace the lats the tiles or slates hang off.

All this is a long way round of saying the account given may be called into question and I say that without wishing to question the OP's honesty in any way. It also depends on the total amount being spent as a repair would be a smaller sum than a replacement roof. As a guide I would say hundreds of pounds is a repair while thousands is capital. Perhaps the best thing to do is talk about the two alternate treatments with the building owner.

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By Cant Add Up
31st Dec 2013 12:53

Sorry correction....lats to be replaced as well.

 

 

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By zebaa
31st Dec 2013 13:10

Lats as well ?

Sounds to me only thing retained will be rafters, purlins and brick built gable ends - assuming there are any - not all roofs have them. I think this is what most people would call a new roof albeit may be on an old building; therefore I think capital.

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By MDK45
31st Dec 2013 14:02

I think the answer lies with the slates. If they can be reused mostly but just topped up with new ones then definitely repair. I'm no builder but replacing the lot sounds unnecessary and more like improvement.

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By Steve Kesby
31st Dec 2013 14:23

The extent of the work isn't relevant

You need to start by identifying the entirety that is the capital asset. If you restore that entirety to it's former condition by completely replacing a constituent part that's a repair provided that there's been no improvement to the entirety.

If the entirety is improved, the whole expense is capital. You can't claim a notional repair element.

Here the entirety is the building and the roof is merely a constituent part. The William Lawrie case is directly relevant. See BIM35465. They had to replace their roof, but when they did so took the opportunity to make their building bigger, so that it also needed a new roof.

It was agreed that had the roof just been replaced, it would have been allowable revenue expenditure, but the larger building and larger roof meant it was capital expenditure and no deduction was available for the cost that would have been incurred replacing the old roof.

If the repair elements and improvement elements can be isolated though, the repair element won't then be notional and so can be claimed.

As mhtax notes, if any improvement is simply due to the use of modern materials or methods that won't render the expenditure capital. That comes from the decision on Conn v Robins Bros. See BIM35480 and BIM35455, which also provide some useful commentary.

As carnmores says, it will also be regarded as capital expenditure if it arises from dilapidations arising prior to purchase (or bringing it into use in the business), but that doesn't seem to be the case here.

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By John R
31st Dec 2013 14:32

New roof is repair

The asset is the building. The replacement of part of an asset is usually a repair. The roof is part of the building. If the roof has to be replaced, even in its entirety, it is therefore a repair UNLESS the new roof is of a better quality than the old one. Better quality means more than simply changing to more up-to-date materials. E.g. a corrugated iron roof replaced with a slate one would be an improvement. A slate roof replaced with a tiled one would probably be a repair. See BIM46915 which includes an example confirming that this is the Revenue view.

Edit: You beat me to it Steve.

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By Marielle Holmes
04th Jun 2015 06:37

Thanks a lot for sharing. Building repair is very important because inadequate maintenance may threaten public safety. External parts of a building will be weathered quickly when exposed to the natural environment. Without proper maintenance, they will deteriorate easily. Regular inspection and maintenance may enable timely identification of deteriorated building elements.

     

 

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