Included in the small print of this year’s Budget was a notification that HMRC are to consult on plans to change historic capital expenditure claims. People hoping to reduce their tax bill by making a claim for a property they have owned for sometime may find that they are no longer entitled to do so in the future.
Currently, taxpayers may claim capital allowances in respect of ‘fixtures’ for any open tax return, irrespective of when they were acquired, provided they are still owned by the taxpayer. Business owners may delay claims to suit their own circumstances, such as whether they are currently in a taxpaying position. However the right to claim for historic expenditure is under threat and as Debbie Franklin, Tax Partner at Peplows states, “Whilst the outcome of this consultation cannot be known, it is feared that changes may be introduced with immediate effect leaving people with no time to take action once the decision has been made.”
The conclusion to the review will be published at the end of May and enacted in the Finance Act 2012. “We therefore recommend that people review their property portfolio now to ensure that the right to claim is not lost. Claims can be made for purchased property, new builds, extensions and refurbishments,” added Debbie.
Email Debbie for further information at firstname.lastname@example.org or call 01626 208802.