Member Since: 15th Nov 2010
After failing at and early age to make a living by playing guitar, I started a career helping clients to save money and become more efficient. In 2009 I set up Curtis Plumstone Associates to concentrate on undertaking Capital Allowances Claims on Commercial Property. My business partner is a Deloittes trained expert in this field and my job is to keep him as fully employed as possible on projects large and small.
Director - Capital Allowances Claims Curtis Plumstone Associates
22nd Jan 2015
Last throw of dice?
Thank you for your answer Portia.
Would it make any difference if the client went back and amended their 12/13 tax return to exclude the W&T allowance? i.e. they just claimed capital allowances for 13/14? Would this then allow them to claim AIA in 13/14?
Also we may be undertaking a claim for the fixtures in the property which would not have been allowable when it was an ordinary rental property so could AIA be claimed on these?
Thanks very much for your help.
21st Jan 2015
In my opinion
I'm not an accountant but my company deals with capital allowances claims on commercial property. I believe, unless anyone has any ides to the contrary that:-
a) The replacement of the old electric fire represents an improvement and should therefore be capitalised and capital allowances claimed.
b) The windows being a direct modern replacement can be classified as a reapir / revenue expenditure
c) Any items which are estimated to last more than two years may be capitalised as they have an enduring benefit to the trade. Replacement of these items would then be treated as revenue expenditure.
d) Any new items would then be either capital if they have more than a two year life span (and would be covered by the AIA) or they would be revenue items if they are not likely to last two years.
If your interested we claim for capital allowances on the fixtures in commercial property such as sanitary ware, heating and electrical systems etc which can represent 25% of the original purchase price of a standard furnished holiday let. If your interested in learning more please pm me of or phone me on 07779 756213,
7th Jan 2015
You cannot claim capital allowances under the integral features rules unless the expenditure was incurred after the legislation was introduced in April 2008. You would need to go back and question the capital allowances company used on this point. You will also need to make sure they haven't claimed for anything which they shouldn't have if the integral features rules do not apply.
3rd Nov 2014
Could I ask when you say they were closely related what the actual relationship is? Just want to check that the connected party rules do apply.
If the connected party rules do apply then you may well be restricted to the cost that the close relation paid for the property and therefore the qualifying fixtures. However I don't see that this would restrict your client from claiming for the fixtures including integral features as they purchased in 2013? Unless I am missing something here.
The main changes that were introduced by integral features were cold water systems and that electrical systems didn't have to be connected to a qualifying piece of plant so things like general lighting were then claimable. Heating systems were claimable before integral features so all the integral features legislation did was to say where the expense was incurred from April 2008 onwards then it had to be classified as Special Rates Pool expenditure rather Main Pool expenditure.
I hope this makes sense.
3rd Nov 2014
The OP actually refers to Plant & Machinery not Plant & Equipment. Fixtures as defined in the capital allowances act still come under the generic heading of either Plant or Machinery although I admit there is a lot of confusion on this subject. In the same way that some don't understand that Integral Features are still fixtures
However I think you are probably right that the OP is not referring to "Fixtures" as defined in CAA so I shall slink back into the shadows.
2nd Nov 2014
I hope this helps again
I still think the answer is within the CAA
Either Section 197 Disposal Values in Avoidance Cases or Chapter 17 - Connected Party Rules.
2nd Nov 2014
I hope this helps.
Dear Jim H.
Firstly can I declare a professional interest as I own Curtis Plumstone a Capital Allowances Claims company so I'll state up front that if we can be of assistance with an estimate for the claim I'd be happy to oblige. Having got the sales pitch out of the way the answer to your questions are:-
Your client purchased the property in 2013. As the previous owner was not eligible to claim capital allowances then the "Fixed Value" requirement introduced in April 2012 does not need to be met i.e. no need for a S198 election agreement. The "Pooling Requirement" was not introduced until April 2014 so does not effect this purchase. In essence your client's case falls under the old rules pre April 2012.
It sounds unlikely that the property has previously been subject to a capital allowances claim for fixtures in the past although any competent capital allowances claims company will endeavour to trace the properties history back to June 1996 to prove this point and fully document the evidence.
With the majority of capital allowances claims on FHL's, our experience shows, a claim for fixtures/integral features will be somewhere between 20% to 30% of the original purchase cost of the property. Therefore I would suggest that before putting in a low estimate of 10% you obtain a fee estimate from a competent capital allowances claims company to see whether there could be a real benefit in employing such a specialist.
If I can be of further assistance then please pm me or e-mail [email protected]
Kind regards John
30th Oct 2014
This Article will be of interest.
The following article although written in 2011 should be of interest, You are talking about an artificial transaction purely designed to accelerate the tax relief which would fall fowl of the legislation:-
Hope this helps.
8th Oct 2014
Probably not an Issue
As long as the understanding is that the reduction in rent is just an incentive to let the property and not the council making a contribution to the cost of the refurbishment work HMRC shouldn't be able to question the claiming of capital allowances. Given the level of spend I don't think HMRC will be that concerned.
8th Oct 2014
I think your right
Yes when I read the guidance it is clear that the property has to have qualified as an FHL in the year before the first election. If the tax year is closed in which it could have first qualified then I can't see a way back.