The Tax Relief 80% of Property Investors Are Yet to Claim
Taxation is a significant aspect of a property investment or development business. The amount of tax you pay impacts your return on the investment, so why wouldn’t you take advantage of all the tax relief available to you?
Time and again we see one specific tax relief consistently overlooked, simply because property investors just don’t know about it.
The Overlooked Relief Sitting Inside Your Property
As part of UK tax legislation, tax relief can be claimed on part of the costs incurred to purchase, build, refurbish or extend a commercial property or short-term let.
This is an ‘extra’ level of capital allowances that can be claimed on the ‘embedded’ fixtures purchased with or installed in a qualifying property. Essentially, these are items that would not fall out if the building was turned upside-down like heating and electric systems, water pipework, kitchens, bathrooms and more.
For those of you that have heard of capital allowances already, you may fall into the trap that many property investors do and assume “my accountant already claims capital allowances for me” . . . but this isn’t the case!
Whilst accountants can claim some capital allowances, it’s usually restricted to items like furniture and equipment that you purchase and have a receipt for.
Claiming capital allowances on the embedded fixtures within the fabric of a building or land, requires quantity surveyors and specialist capital allowances tax knowledge to identify and quantify the qualifying expenditure.
These are skills that fall outside the remit of a general accountant and so the available tax relief often goes unclaimed! Even if you incurred expenditure years ago, you could still be able to claim now.
On average, 20%-30% of the capital costs incurred are identified as qualifying for capital allowances. This can generate significant tax savings which can mitigate tax liabilities for several years. In most cases, claiming this tax relief also generates a cash rebate for tax previously overpaid to HMRC.
Don’t miss out on claiming something you are entitled to. The tax benefit unlocked could reduce your taxable profits or even provide additional funds for your next project.
Own a Short-Term Accommodation or Furnished Holiday Let?
Time is ticking to claim the benefits available to you.Following the tax changes in April 2025, capital allowances will no longer be available to short-term let owners. However, even though April has passed, it’s not too late to claim your tax relief entitlement - but time is of the essence!
The last opportunity for owners to claim capital allowances is in their 2024/25 tax return (or 2025 year-end for companies). For individuals, this must be submitted by January 2026, but can be amended up to January 2027 (a little later for some companies). Any entitlement not claimed by this final deadline will be lost.
As an additional bonus, the allowances you secure before the deadline can be offset against tax due on ANY UK property income from 2025/2026 tax year, not just your short-term lets.
Make sure you act before the deadline or you’ll lose valuable cash and tax savings.
Free capital allowances review with Zeal
Zeal are Chartered Tax Advisors and qualified RICS Surveyors. Our team specialise in capital allowances and helping commercial property and short-term let investors enhance their tax efficiency by uncovering unclaimed tax relief in their properties.
We invite you to schedule a free capital allowances review with our team to establish if you are missing out on tax relief.
It won’t cost you a penny to find out if you qualify – only a few minutes of your time. You’ll also be given a free estimate of your potential tax benefit. Plus, as Zeal operate on a success-fee basis with no upfront costs, there’s no risk to you!
Scan the QR code to select a date and time for your free review.
Alternatively, please feel free to reach out to us on 01905 691308 or contactus@gozeal.co.uk.
