Business owners are being urged to seek professional advice as the Government commences consultation on property capital allowances which could have far reaching and financial ramifications says commercial property agent prop-search, a fact that is supported by accountants Isis Business Solutions.

The Government has now begun a consultation on whether property owners would have to pool their expenditure on qualifying fixtures within a short period after acquisition in order to qualify for capital allowances. It appears likely that the Treasury wants to limit its exposure to retrospective capital allowances claims for earlier unclaimed expenditure. 

Simon Toseland, a Director of prop-search, says: "Currently commercial property owning taxpayers can claim capital allowances on any open tax return as long as the property is still owned. This proposed change would probably mean that property owners would have to make a claim for capital allowances as quickly as possible after the expenditure is incurred, irrespective of their current tax position. There is currently no suggestion as to how short this period is likely to be."

Mark Hollyman a Director of Isis Business Solutions adds: "Property owners would also be restricted from introducing capital allowances claims on historic, previously unclaimed expenditure, which has been a fundamental part of the capital allowances legislation over many years. We see a very high volume of retrospective apportionment claims based on property purchase prices that attest to the consistent under-utilisation of allowances opportunities."

Qualifying opportunities for capital allowance claims are typically businesses that have purchased commercial properties; who have carried our refurbishments or built extensions within the last 15 years; or who have long leasehold and carried out substantial tenant improvements.

It is vital that all commercial property owners prioritise now to undertake a thorough review of their capital allowances positions on their properties, irrespective of how long it is since they were purchased. In the future, owners will also have to address possible claims in 'real time' as they will no longer have the comfort of being able to claim at a later date and could suffer financial loss.  

In addition and vitally, this puts much greater emphasis on incorporating capital allowance planning into the specification stage of new building projects.

Further information can advise can be obtained from prop-search - Tel: 01933 223300 or Isis Business Solutions - Tel: 0845 345 7785.