Capital Allowances: Surveyor Partner Service

Surveyors are often the first to learn that a client is looking to buy or sell a commercial property and this presents an opportunity to address capital allowances considerations from the outset. There are significant tax savings available when you take advantage of capital allowances - they enable you to reduce your taxable profits by the value of any qualifying capital expenditure incurred when buying, selling or refurbishing commercial property.

As with any tax relief, this can be complicated. That is where support from a capital allowances specialist at Monetta can help. Our experts have a wealth of experience and take a thorough approach to each transaction from the outset, which allows us to identify all of the relevant capital expenditure and qualifying assets. This allows us to maximise the value of a capital allowances claim and identify other hidden tax relief opportunities on behalf of commercial property owners and buyers.

We believe that the best result for your clients is the best result for you as their surveyor, and our approach to building partnerships leaves all parties satisfied by the tax savings they have enjoyed. Call your local Monetta office or use our online enquiry form to get in touch, and learn how our capital allowances surveyor partner service can support you.

How Monetta Can Help

Whether you are acting on behalf of the seller or buyer, there are capital allowance implications which may need to be addressed. This is also true whether your client is a business or an individual investor, as capital allowances can act as a tax relief for the purposes of both Corporation Tax and Income Tax, meaning that there are opportunities for all parties within this financial mechanism. Unclaimed allowances on qualifying expenditure represent an unnecessary loss that can be avoided with expert support.

At Monetta, our capital allowances team can help your clients to make the most of their property investment by taking a comprehensive and thorough approach to the financial aspects of the transaction. We are able to provide assistance from the outset in a number of ways, including:

• Setting out and reviewing capital allowances enquiries when buying or selling
• Providing the correct contractual clauses within a sale and purchase agreement
• Ensuring all parties are aware of their obligations with respect to mandatory pooling
• Preparing a compliant CAA2001 s198 election

There are many types of allowances, from plant and machinery allowances to structures and buildings allowance that can be claimed in these cases. Thanks to our expertise, we can identify all of the relevant factors that will maximise your client's claim and the tax relief they enjoy. Speak to a capital allowances specialist from Monetta today for advice. Some of our success stories are also presented below.

Case Study: Capital Allowances for an LLP

A surveyor contacted us to look at the potential capital allowances from an office building being purchased from a pension fund. The pension fund could not claim capital allowances and, as such, our client would be the first entity entitled to submit a capital allowances claim.  

The office purchase price was £5m and the LLP was formed of Income Tax payers, most of whom were 45% tax payers. We identified allowances of £1,350,000 that would provide them with total tax relief of £607,500. We provided the surveyor with wording for the heads of terms, which were then conveyed in the sale and purchase agreement. This allowed our client to take the tax relief benefit after the purchase.

Case Study: Portfolio Review

We were approached by a surveying firm acting for a client who was selling a mixed portfolio of commercial properties. The buyer had asked about the availability of capital allowances and, because we had a good relationship with the agents they asked us to review any allowances that could be available. After looking at the portfolio, we concluded that the seller had never claimed allowances on any of the properties and, after looking at the ownership history of the properties, we were able to establish that capital allowances in the region of £2.5m to £4m could be available after a full review.

Although allowances were not available on all of the properties, approximately 80% of the portfolio was unrestricted for a capital allowances claim. Once we had established the level of allowances and then informed the seller, they decided that they would like to make the relevant capital allowances claims and then take advantage of the first two years of tax savings and pass the remaining allowances to the purchaser. These additional allowances made the portfolio more attractive to the purchaser.

Creating Lasting Partnerships

There are many good reasons to consider capital allowances as a surveyor. The RICS red book suggests that all tax implications should be ignored when valuing a property, meaning that Stamp Duty Land Tax (Land and Buildings Transaction Tax in Scotland), VAT and capital allowances are all excluded from a valuation perspective. However, when there is any available tax relief, your client will thank you for factoring this value into your calculations.

At Monetta, our expertise positions us effectively to deliver this additional value to your clients. When you partner with us, they will be able to claim capital allowances and maximise their tax savings, which is often a key incentive for commercial property purchases. The key elements of our capital allowances surveyor partner service include:

• Providing an initial review of the correct capital allowances position, assisting to answer any CPSE enquiries relating to capital allowances.
• Negotiating a CAA2001 s198 election figure.
• Preparation of the correct CAA2001 s198 election in the event of a prior capital allowances claim.
• Providing contract wording for sale and purchase agreements to ensure the correct position for capital allowances is addressed.
• Carrying out CPD training, online or in-person.

We know how vital tax relief can be to the cost-effectiveness of a property transaction, and we want to support surveyors to offer this benefit to their clients. This mutual benefit underpins our entire approach, and leaves all parties happy with the outcome. Through this, Monetta's capital allowances experts aim to build lasting relationships with surveyors that can minimise the tax liability of every client over time.

Why Choose Monetta?

At Monetta, we have represented buyers and sellers in many commercial property transactions, and helped to deliver the best value for all parties. With a network of offices in the North West, we can scale our services to meet the demands of even the most complicated transactions. This means we can also offer more personal investment in the specific requirements of each transaction, and tailor our services to the specific requirements in each case.

Thanks to our in-depth knowledge, we can identify qualifying assets and expenditure quickly. We will never hold up the sale of any property as we will be able to establish the capital allowances position within a short period of time. More often than not, we are able to guide a surveyor and their client on the correct capital allowances position within a couple of hours. The actual review does not need to happen prior to a property purchase. We will liaise briefly with the seller’s solicitor and then provide wording for any sale and purchase agreement, to allow for the capital allowances to be passed to the buyer, if applicable.

Get in Touch

If you are a surveyor who deals with property acquisitions or construction projects on a regular basis, consider speaking to our tax advisers about the capital allowances options that may be available. Call your local Monetta office or use our online enquiry form to get in touch. Alternatively, you can visit our team page to learn more about each individual capital allowances specialist in our team.