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Garden shed wholly and exclusively for business use

Garden shed wholly and exclusively for business...

Hello.  I have received conflicting advice from HMRC, so can anyone confirm one way or the other:

If a one-man-band limited company buys a garden shed and puts it at the bottom of the director's home garden (and fits it out and has a seperate electric metre put in), is the cost of the shed itself allowable for capital allowances?  It is used wholly and exclusively for business purposes.  It is likely to have a life span for 10 years.  The company's intention is to trade for longer than this and replace it in 10 years time.


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20th Jan 2012 16:16

I assume your chap's just got the one garden?

Unless it's moveable (from site to site, as opposed to different corners of the garden - although there was an interesting gazebo case a while back, that might support the moving from one corner to another being sufficient) and intended to be moved in the course of the trade, then it's a "building or structure" and you'll only get capital allowances on the fixtures, fittings and integral features.  He ought to be able to reclaim the VAT though if he's VAT registered.

The separate electricity meter has puzzled me a bit though (probably no CAs on that either incidentally).  What is it that he'll be doing in the garden shed that's wholly and exclusively business and demands its own electricity meter?  If he's growing questionable substances, I might need to add some more caveat.

If he's going to use it as an office, it might be worth a rethink, given limited relief.  It does get so cold in the potting shed in the winter months, particularly with the windows blacked out, unless of course he's got those nice infra-red lamps to keep him and the growing stock nice and warm. :)

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26th Mar 2012 12:15

A client asked me a similar question this morning about buying a garden shed, running heat and light to it and then using it as an office.

I am correct in thinking:-

-cannot claim CA's on the purchase of the shed as it is a building structure

-can claim CA's on the fixtures, fittings and equipment purchased for the office

-can claim the portion of heat and light that relates to the shed

-claiming the heat and light would have no effect on the PPR of the property?

Thank you in advance for any comments or tips.


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