Case Studies

Examples of some of our past projects

FACTORY – £364,143 OF ALLOWANCES

This project comprised the refurbishment and alteration of an industrial unit in the South East recently acquired by an investor. Typical claimable items include: Sprinkler installations, CCTV, electrical systems, sanitary fittings, fire alarm and ventilation systems. The purchase price of the property was £1,900,000. CPA’s analysis identified £364,143 of Capital Allowances additional to the acquisition allowances.
This produces an overall tax saving for a 23% taxpayer of £83,752 for the investor with a first year saving of £7,537 excluding the impact of the Annual Investment Allowances (AIA). If the owner was able to benefit from the full value of the current AIA (£500,000) then the first year tax saving would increase to £39,782.

CARE HOME – £650,000 OF ALLOWANCES

This property was acquired by a care home group in the Midlands, and the purchase contract identified that the seller had previously claimed Capital Allowances on part of their expenditure but had not elected to retain any allowances. The purchase was made before the introduction of integral features. Typical claimable items include: Heating installation, emergency lighting, hot water installation, passenger lift, cold water installation and nurse call system. The purchase price of the care home was £2.3 million. CPA apportioned the purchase price to generate £650,000 of additional Capital Allowances for the purchaser taking into account the restrictions from the allowances previously claimed by the former owner. This produces an overall tax saving for a 23% taxpayer of £149,500 for the investor with a first year saving of £26,910 excluding the impact of the Annual Investment Allowances (AIA). If the owner was able to benefit from the full value of the current AIA (£500,000) then the first year tax saving would increase to £72,507.

DENTAL PRACTICE – £180,000 OF ALLOWANCES

A medical centre was constructed in London by an investor who retained the property and lets it to a partnership of dentists. The contract was let on a design and build basis with very little breakdown of the tender cost. Typical claimable items include: Doctor call/security system, reception desk, passenger lift, induction loop, heating system and sanitary appliances. The construction cost was £600,000. CPA’s analysis of the expenditure produced a claim of £180,000. This produces an overall tax saving for a 23% taxpayer of £41,400 for the investor with a first year saving of £7,452 excluding the impact of the Annual Investment Allowances (AIA). If the owner was able to benefit from the full value of the AIA current (£500,000) then the first year tax saving would increase to £41,400.

RESTAURANT – £392,542 OF ALLOWANCES

A McDonalds restaurant based in Bangor acquired by an investor. The seller was a foreign investor company and a non-UK taxpayer entitling the owner to full Capital Allowances claim. Typical claimable plant includes: Illuminated sign, cold water systems, vinyl flooring, built-in cold rooms, work tops, illuminated intercom station, shelving, sanitary systems. The acquisition cost was £1,289,600 and total claimable allowances were £392,542. The property was held in a limited company paying corporation tax which resulted in a total tax saving of £78,508. With the current AIA set at £500,000 the total amount of £78,508 was claimable in the first year.

APARTMENT BLOCK – £1,200,000 OF ALLOWANCES

A city centre block was purchased from a developer. The developer had held the property as trading stock and was not entitled to claim Capital Allowances thereby allowing the owner an unrestricted claim to Capital Allowances. Typical claimable plant includes: Space heating, transformers, electrical system, fire alarm, lifts and CCTV. The purchase cost was £8,000,000. CPA generated £1,200,000 of allowances on an apportionment basis from the common areas only in the property – i.e. the corridors, lifts, stairwells, shell retail areas and plant rooms. This produces an overall tax saving for a 23% taxpayer of £276,000 for the investor with a first year saving of £34,500 excluding the impact of the Annual Investment Allowances (AIA). If the owner was able to benefit from the full value of the current AIA (£500,000) then the first year tax saving would increase to £80,442.

BANK – £445,987 OF ALLOWANCES

This property was purchased for £1,655,000 in London with a high street bank occupying the building.
Typical claimable plant includes: Strong room, mechanical lifts, electrical systems, fire systems, CCTV and ventilation systems. CPA identified £445,987 worth of Capital Allowances for the purchaser. This produces an overall tax saving of £102,577 for the investor with a first year saving of £18,463.

Mixed portfolio – £3,204,030 of allowances

Our client owns a portfolio of commercial and semi-commercial properties including retail units, office blocks and restaurants; over 20 freehold properties in total. The total purchase price consideration was over £11,000,000.
The properties were held in various partnerships and limited companies with a limited amount of property purchase documentation available to the client. CPA conducted extensive research into the entitlement available for each property, surveyed each property and ultimately were able to identify over £3,200,000 in allowances. This led to a total tax saving for the client of over £736,936.

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