Commercial property owners should grab tax benefits

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Owners of commercial properties in the south west should grab a tax-opportunity to upgrade any vacant premises, according to a specialist at Bishop Fleming – the accountancy firm with the widest spread of offices throughout this region.

According to Andy Richens, technical tax director at Bishop Fleming:  “100% enhanced capital allowances are now available for approved energy saving fixtures and plant, and this tax benefit can be factored into any repair or replacement expenditure plans.

“This would be money well spent, as putting this in place now will increase the property’s energy performance rating. An Energy Performance Certificate (EPC) will now be necessary when the building is sold or re-let,” said Richens. 

He also points out that such planning will be crucial, with the EC draft Energy Performance of Buildings directive suggesting the next EPC legislation will require energy improvements to be an objective of any refurbishment. 

“Commercial landlords can make a significant tax-saving and rental premium by grabbing this opportunity, but should seek professional advice on which energy saving fixtures and plant qualify for the enhanced tax allowances,”, said Richens.

“At the time of a tenant vacating the property, there may be a payment due to the landlord under the terms of the lease for dilapidations. It has been the normal practice for the landlord to carry out enough repairs merely to put the property back to its original state.”

He added: “In the current economic climate, the owner will probably be holding onto a property for longer than originally planned. Rather than dealing with maintenance by merely carrying out a ‘lick n stick’ fix, this might be the moment to invest in an energy-efficient upgrade and grab a tax benefit – and higher rental potential.”

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