My question is can you claim annual investment allowance on an asset which is not yours?
I am doing some bookkeeping and the company concerned is entering into a 5yr agreement to rent a property from a landlord. The company then sublets that property by letting rooms and makes profit by charging higher rents per room than they are then paying on to the landlord.
The company is responsible for all repairs which are going through the profit and loss.
When they initially take on the property there are items of refurbishment expenditure in getting the property in to a fit state to charge high rent. The accountants have capitalised this and charged depreciation but in the tax return they have claimed annual investment allowance.
I just want to make sure , in my own mind, that you can do this on an asset you don't own. The company has control of the asset for a number of years but the benefit of that work on refurbs is going to someone else.