Leisure and Hospitality Embedded Capital Allowance Claims

What are embedded capital allowances?

If you are a leisure business that owns property, there is a chance that you could make a claim for embedded capital allowances, which could give you a cash rebate from HMRC or a reduction in current and/or future tax bills.  The relief can be as much as 40% of the cost of your property but many assets that could qualify for capital allowance relief are often overlooked due to their very nature of being “embedded” within the structure of a building.

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In the instance where an old or newly-built property has been purchased, a new property has been constructed, an existing building has been altered, extended or refurbished or refitted, then the costs of certain items embedded in the property can be claimed.  Businesses within the hotel and leisure industry are rich with capital assets that qualify for capital allowances, such as swimming pools, spas and other leisure facilities, catering and cleaning equipment and electrical and lighting systems.

Why can’t my accountant do this for me?

This is an area of specialism typically outside of the remit of a local accountant. Our specialist teams of tax advisors and surveyors deal frequently with embedded capital allowance claims and have developed extensive experience and knowledge in this area.   An added consideration is that the hotels and leisure sectors often have specific trade-related assets that are not easily identifiable and may require a specialist surveyor to identify.  For example ambient expenditure, including artwork and decorative assets; mechanical and electrical installations (including machinery to automate entrance doors); advertising hoardings and; works lifts and food hoist shafts.

We operate a simple 5-step process to investigate and process embedded capital allowance claims. You can learn more about how to get started here and view your eligibility.

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