Introduction »

What a relief

Over the last ten years, many tax reliefs have been introduced. Some are very specific and often only apply to limited companies. However, if they apply to your business, they can be very valuable. We thought that it might be useful to have a brief recap of some of these reliefs, especially as the Government are considering withdrawing some of them in the future. As always, advance planning is essential, so please get in touch with us if you are planning any new projects in any of the areas mentioned.

What a relief part 1 - Remediation of contaminated land

This relief is designed to provide incentive for developers, investors and landlords to participate in the regeneration of urban sites and buildings. It is only available to companies.

Whilst the relief has been available since 2001, it appears that the Government may withdraw this relief in the near future, so maximising it while it is still here is crucial.

When relevant conditions are met, a company can:

• elect that capital expenditure on qualifying land remediation expenditure is allowed as a deduction against its trading or property business profits
• claim an additional 50% relief for qualifying land remediation expenditure as a deduction against those profits
• receive a payable tax credit in exchange for any qualifying land remediation ‘loss’ surrendered.

Land also includes buildings.

The relevant conditions are that:

• land in the UK is, or was, acquired by the company for the purposes of its trade or rental business and
• at the time of the acquisition all or part of the land was in a contaminated state and
• the company incurs qualifying land remediation expenditure in respect of the land.

However, no relief is available if the land, or any part of it, is in a contaminated state as a result of anything done, or not done, at any time by the company or a person with a relevant connection to the company.

Basically, the relief is aimed at cleaning up dirty land. Bearing in mind that asbestos is probably the biggest single contaminant in the country, it starts to become clear how wide the relief is.

So don’t miss out. Get in touch today if you think that you might be able to claim.

What a relief part 2 - Renovation of business premises in disadvantaged areas

Business Premises Renovation Allowance (BPRA) has provided 100% capital allowance relief for expenditure incurred on the conversion or renovation of qualifying business premises in disadvantaged areas since 11 April 2007. The scheme was originally intended to run for five years from that date.

The Government has now confirmed it will extend the BPRA for a further five years from 2012.

The scheme provides tax relief to any individual or company that incurs capital expenditure on bringing qualifying business premises (whether owned or let) back into productive business use. It could apply to trading or property investment businesses.

The allowances are given if a person incurs capital expenditure in connection with the conversion or renovation of a ‘qualifying building’ into ‘qualifying business premises’ or on capital repairs incidental to such conversion or renovation. As the qualifying business premises must be in a disadvantaged area, take a look at www.dtistats.net/regional-aa/aa2007.asp to see if your premises are in the right area.

To qualify the business premises must also not be used as dwellings or be held or used for certain trades. Please contact us for details of excluded trades.

What a relief part 3 - Conversion of parts of business premises into flats

Another scheme provides 100% capital allowance relief for expenditure incurred on renovating or converting space above shops and other commercial premises into flats for letting. The scheme enables property owners and occupiers to obtain upfront tax relief for their capital expenditure on recycling former residential space over shops.

The scheme, which includes all normal conversion expenditure, is only available on qualifying buildings. A qualifying building is one:

• where all or most of the ground floor is authorised for business use
• where it appears that, when the building was constructed, the storeys above the ground floor were for use primarily as one or more dwellings
• which has no more than 4 storeys above the ground floor and
• whose construction was completed before 1 January 1980.

Further, the expenditure must relate to a part of the building which was either unused or used only for storage, throughout the period of one year before the conversion or renovation work began.

There are other conditions and exclusions but the tax reliefs on offer could help finance your next business venture. So don’t delay.

Introduction »

Integra Accounting Limited is registered in England and Wales. Registration number: 5391227.
Registered office address: 5 Station Road, Hinckley, Leicestershire LE10 1AW

powered by totalSOLUTION