3% tax relief is available if you’ve built, bought or leased a non-residential building or structure.
Structures and buildings allowances (SBA) are a type of capital allowance that helps businesses invest in infrastructure. They provide tax relief on the cost of constructing new non-residential buildings or improving existing ones. Examples of non-residential buildings include offices, hotels, and retail spaces.
You can claim on your expenditure on or after 29 October 2018 (as long as you signed contracts after this date).
You can claim a structure and buildings allowance if you partly or wholly:
• Constructed or renovated a building or structure (even if you lease from someone)
• Bought a structure from a developer (you can claim for the eligible expenditure on what you paid the developer)
• Bought a structure from someone who wasn’t a developer (you can claim for the same amount that the previous owner was entitled to)*
*To claim a structures and buildings allowance on a qualifying second-hand building, you need to have a compliant “Allowances Statement” from the vendor of the building.
You can claim the market value of your construction costs, including: fees for design; preparing the site for construction; renovation, repair and conversions costs; fitting and construction works.
Examples of construction costs include structural and similar building-related works like walls, floors and roofs. You can claim for expenses that relate to the physical construction or improvement of the building, including fees for architects or surveyors.
You can’t claim on costs that also qualify for plant and machinery allowances.
From 1 April 2020, you can claim 3% each year on a straight-line basis over 33 and one-third years. The available amount depends on the cost of construction, improvement or purchase of the structure.
For example, if you spend £1,000,000 creating a new structure, you can claim a tax deduction of £30,000 each year for the next 33 and one-third years.
If you sell or demolish the structure, your claim will stop, but the new owner can claim any remaining allowances.
We have a proven track record of delivering significant tax relief benefits for businesses by maximising their capital allowance claims.
Our team of experts have years of industry experience in construction, engineering, surveying, accounting and tax advisory, allowing them to drill into the detail to identify every possible way to make savings for your business.