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Spanish Holiday Villa – allowances of £200,000

The relaxation of rules that allow claims to be made on all European Villa lets in the European Economic Area as well as the UK (provided that the qualifying rules are met) has opened up the possibility to claims being made throughout Europe.

This property was purchased from a non-UK national not resident in the UK and, therefore, not previously qualifying for Capital Allowance purposes.

Typical claimable items include: Air conditioning installations, pool with heating and filtration, kitchen fittings and appliances, satellite and TV installations, sanitary and TV installations, sanitary appliances and accessories, intruder alarms and security lighting.

The purchase cost was £900,000.  Stuart Rivers Associates visited the property in Spain and generated Capital Allowances in excess of £200,000 from an apportionment of the purchase price.

This produces an overall tax saving for a 45% taxpayer of £90,000 for the investor with a first year saving of £10,800 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 £90,000.