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Industrial Unit/Warehouse – allowances £230,000

A newly constructed industrial unit was bought in the North of England by an owner occupier from the developer who held the property in trading stock and was, therefore, not entitled to claim Capital Allowances. This enabled the owner to be entitled to a full claim on their purchase price.

Typical claimable items include: Fire alarms, cold water systems, electrical system and sanitary fittings.

The unit cost £1,600,000 and Stuart Rivers Associates apportioned the purchase price and generated £230,000 of Capital Allowances.

This produces an overall tax saving for a 20% taxpayer of £46,000 for the investor with a first year saving of £5,520 excluding the impact of the Annual Investment Allowances (AIA). If the owner was able to benefit from the full value of the current AIA (£200k) then the first year tax saving would increase to £40,720.