Protecting Capital Allowances During Commercial Property Transactions
When purchasing a commercial property, Capital Allowances are often overlooked during the acquisition process. Failure to review the position before exchange or completion can result in valuable tax relief being permanently lost.
At CA Select Limited, we support buyers, accountants and solicitors by reviewing the Capital Allowances position during commercial property acquisitions and transactions.
Our due diligence process helps identify:
- qualifying embedded fixtures
- historic unclaimed allowances
- Section 198 election issues
- gwariant adnewyddu
- pooling complications
- risks that may affect future claims
Early review is important because once a transaction completes, opportunities to secure allowances may be restricted or lost entirely.
What Is Capital Allowances Due Diligence?
Capital Allowances due diligence involves reviewing a commercial property transaction to establish whether qualifying expenditure and embedded fixtures can be claimed by the purchaser.
This process typically forms part of the wider legal and financial due diligence undertaken during an acquisition.
The review may include:
- CPSE replies
- draft sale contracts
- title information
- historic ownership details
- previous Capital Allowances claims
- Section 198 elections
- refurbishment records
- invoices and fixed asset schedules
- surveys and plans
The objective is to identify both opportunities and risks before the transaction completes.
Why Capital Allowances Due Diligence Matters
Many commercial properties contain significant qualifying embedded fixtures such as:
- electrical systems
- lighting
- systemau gwresogi ac aerdymheru
- llestri glanweithiol
- fitted kitchens
- fire and security systems
- lifftiau
- specialist installations
However, the ability to claim these allowances is heavily influenced by the way the transaction is structured.
Issues such as:
- colli etholiadau Adran 198
- historic pooling failures
- statws treth gwerthwr
- public sector ownership
- previous claims
- undocumented refurbishments
can all affect the purchaser’s ability to claim Capital Allowances.
Failure to review these matters before exchange can permanently restrict or eliminate future claims.
What CA Select Reviews During a Transaction
Our review process is tailored to each property and transaction, however we commonly review:
Property & Transaction Documentation
- CPSE replies
- draft contracts
- heads of terms
- title documentation
- Land Registry information
Capital Allowances Position
- historic claims history
- seller tax position
- Swydd etholiad Adran 198
- pooling requirements
- embedded fixture ownerships
Historic Expenditure
- refurbishment works
- extensions and fit outs
- mechanical and electrical installations
- capital improvement works
- plant and machinery expenditure
Supporting Information
- invoices
- cost schedules
- fixed asset registers
- plans and surveys
- construction documentation
Common Issues We Identify
We regularly encounter situations where allowances may otherwise have been overlooked or lost, including:
Missing Section 198 Elections
Where fixtures have not been properly transferred between buyer and seller.
Historic Embedded Fixtures Not Reviewed
Many older properties contain qualifying fixtures that have never been identified
Public Sector or Non Tax Paying Ownership
Where previous owners may not have benefited from Capital Allowances.
Refurbishment Expenditure
Historic refurbishment and improvement works may contain qualifying plant and machinery expenditure.
Transaction Assumptions
Capital Allowances are frequently treated as an afterthought during commercial property acquisitions.
Incomplete Records
Missing invoices, historic schedules or supporting documentation can complicate future claims.
Supporting Buyers, Accountants & Solicitors
We work alongside:
- commercial property buyers
- cyfrifwyr
- cyfreithwyr
- property advisers
- buddsoddwyr
to help ensure the Capital Allowances position is properly considered during a transaction.
Our role is to provide practical, commercially focused support during the acquisition process and assist in identifying opportunities and risks before completion.
Types of Property We Support
We support Capital Allowances due diligence across a wide range of commercial property sectors, including:
Speak To CA Select Before Exchange
Capital Allowances due diligence is most effective before contracts are exchanged or transactions complete.
Early involvement can help:
- identify qualifying expenditure
- protect future claims
- avoid missed opportunities
- support negotiations between parties
If you are purchasing, refinancing or reviewing a commercial property, contact CA Select Limited to discuss the Capital Allowances position before completion.
