Tyas & Company
Chartered Accountants, Registered Auditors, Tax, Business Advisors
Wednesday, 11 April 2018 23:01

What plant purchases qualify for a tax allowance?

Most day to day business expenses can be deducted from business income when calculating your taxable profits. However, the rules are different for 'capital’ expenditure'. Capital allowances is the term used to describe the allowances which allow businesses to secure tax relief for certain capital expenditure. There are different rules that apply depending on the type of capital expenditure, and only the person who bought the item can claim a capital allowances.

We will focus below on what plant and machinery purchases HMRC say qualifies for a tax allowance.

Plant and machinery includes:

  • items that you keep using in your business, including cars
  • costs of demolishing plant and machinery
  • parts of a building considered integral, known as 'integral features'
  • some fixtures, e.g. fitted kitchens or bathroom suites
  • alterations to a building to install other plant and machinery - this doesn’t include repairs

Integral features include:

  • lifts, escalators and moving walkways
  • space and water heating systems
  • air-conditioning and air cooling systems
  • hot and cold water systems (but not toilet and kitchen facilities)
  • electrical systems, including lighting systems
  • external solar shading

You can’t claim capital allowances on:

  • things you lease - you must own them
  • buildings, including doors, gates, shutters, mains water and gas systems
  • land and structures, e.g. bridges, roads, docks
  • items used only for business entertainment, e.g. a yacht or karaoke machine.

Consultants

Stephen Tyas                             Stephen Ayres

 

 

Registered to carry on audit work in the UK by the 
Institute of Chartered Accountants in England and 
Wales

Contact Us

Telephone: 01293 843900

Fax: 01293 614312

Email: office@tyas.com

5 East Park, Crawley, West Sussex, RH10 6AN

 

 

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