BUSINESSES and investors involved in commercial property transactions have been advised to review recent deals to avoid missing out on major tax breaks.
David Butterworth (right), of chartered accountancy firm Wheawill & Sudworth, said that the rules on claiming capital allowances are changing – generally for the worse.
“HM Revenue & Customs wants to tighten up in this area, both in terms of the value of tax claims and in reporting deadlines, starting from April 2012,” he said.
The proposals will affect how tax allowances are claimed on fixtures included within a building.
At present, buyer and seller can share the tax breaks as part of their overall price negotiations.
Claims can be made to HMRC over a fairly extended period after the transaction has happened.
“In future, buyers will have to work within much tighter time frames or risk losing out,” said Mr Butterworth.
“The parties will also have to submit a written agreement of the value of fixtures to HMRC within certain parameters and again with set deadlines”.
Mr Butterworth suggested that local businesses and property investors should look again at recent transactions to make sure the maximum tax claims are being made ahead of the new regime.