On 6 April 2015 a new Capital Gains Tax (CGT) charge came into effect on the sale of UK residential property by non-UK residents. The charge applies to gains made by non-resident individuals, non-resident trustees and closely held non-resident companies and funds (to the extent that such gains are not caught by the Annual Tax on Enveloped Dwellings (ATED) related CGT charge).
Owners and Purchasers of Commercial Property - Are you absolutely sure you have claimed all of your Allowable Capital Allowances?
The rules regarding the availability of capital allowances on the sale of commercial property changed significantly on 1 April 2014.
Under the new rules a purchaser of a second hand property is only entitled to claim allowances on second hand fixtures within the building, if the fixtures have been properly identified by the previous owner and recognised in their capital allowance computation.
If a previous owner has failed to make a claim for capital allowances, which is not an uncommon occurrence, the entitlement to those allowances will be lost for all future purchasers of the building.
However, significant opportunities for tax savings remain:
- First Purchasers of Second Hand Properties. Planning can be implemented to ensure that the first purchaser of a second hand property is entitled to the maximum amount of capital allowances, but the planning needs to be implemented before the purchase.
- Owners of Existing Commercial Properties. If you are an existing property owner, in particular if you have made improvements during your ownership of the property, you may be entitled to additional capital allowances. These can be claimed without needing to sell the property.
If you have any questions regarding the above or require any assistance, please do not hesitate to contact Debbie Turner on +44 (0)1372-461411.