During the purchase process the Capital Allowances within a commercial property need to be established. The full tax history of the property must be obtained and a clear understanding of the restrictions on any claim needs to be identified.
Conveyance solicitors have a duty of care to advise on tax aspects of a transaction notwithstanding they may know little about CAA 2001. In addition from April 2014 unless both the pooling requirement and fixed value requirement have been satisfied the availability of future Capital Allowances claims within a property can be lost, thus increasing the possibility of future litigation.
The standard CPSE.1 (version 3.4) documentation acts as a check list in the purchase/sale process and comments such as not applicable or not known are not now acceptable.
We can help complete section 32 of the CPSE documentation.
Solicitors frequently pass section 32 of the CPSE documentation to a client's accountant for completion. A detailed knowledge of CAA 2001 and case law is required and some accountants will be able to complete the section.
A due diligence exercise needs to be undertaken to identify and value the plant or machinery within the property and to establish whether or not Capital Allowances have previously been claimed on some or all of those assets.
The full tax history of the property will also need to be established including whether or not industrial buildings, hotel or agricultural buildings allowances have previously been claimed in appropriate buildings.
We would work closely with your finance director or external accountants to arrive at a just and reasonable figure for Capital Allowances within the property.
We also have a number of accountants who provide us with referral work on existing portfolios.
Surveyors and estate agents
From April 2012 and April 2014 the rules on Capital Allowances in used properties changed such that unless the pooling requirement and fixed value requirement have been satisfied the availability of future Capital Allowances claims within a property can be lost.
Most of the larger practices of surveyors and estate agents have an in-house expert who can advise clients on the availability of Capital Allowances but smaller practices do not.
We would work closely with your property consultant to achieve the best result for your Capital Allowances claim.