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Ashton & Carrington
Capital Allowances · Healthcare premises

£189,300 of Capital Allowances, hidden in the walls.

How a routine commercial property purchase became a six-figure claim, surveyed without disruption and valued to HMRC's own formula.

£189,300
Qualifying plant & machinery
25.2%
Share of purchase price
up to £85,185
Potential tax saved

The engagement

A private healthcare operator bought its freehold trading premises for £725,000. Their accountants had treated the purchase entirely as property. We were instructed to establish what part of the price was, in substance, embedded plant and machinery.

Our approach

  • Desktop analysis plus a single site survey
  • Reconstruction costs from BCIS (RICS) and Spon's data; land value to VOA benchmarks
  • Apportioned to HMRC's formula under CAA 2001 s.562
  • Filing-ready report with statutory basis and pool allocation

The result

Main rate pool
£62,400
Special rate pool
£126,900
Total qualifying plant & machinery
£189,300

HMRC's apportionment formula

Q = P × A ÷ (B + C)

Q qualifying expenditure · P purchase expenditure · A reconstruction value of plant · B reconstruction value of building · C bare site value.

What that's worth in tax

Company, Corporation Tax at 25%
£47,325
Individual, higher rate 40%
£75,720
Individual, additional rate 45%
£85,185

Relief is given through writing-down allowances over time; where the Annual Investment Allowance or full expensing applies, much of the benefit can land in year one.

A real client engagement, anonymised to protect confidentiality. Figures do not constitute tax advice; outcomes depend on individual circumstances.

For every £4 the client had spent on the building, £1 turned out to qualify for tax relief.

More outcomes

Related case studies.

Real client engagements, anonymised to protect confidentiality. Figures do not constitute tax advice; outcomes depend on individual circumstances.

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