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Resources

Tax breaks on property repairs and improvements

Resources

Tax breaks on property repairs and improvements

This page was last updated on April 14, 2020

Businesses with commercial premises used in their business, and landlords letting out property, can claim a deduction for repairs to restore a building to its original condition or to achieve the modern equivalent.

14 April 2020

A building is an entirety, so replacement of a part of the building, such as a new roof, is a repair to the building. Improvement costs, like an extension cannot ordinarily be set against income, although property owners can set this against their liability when the property is sold.

Businesses, including holiday lets, may be able to claim capital allowances, which do reduce taxable income.

Capital allowances include the structures and buildings allowance for construction, renovation or conversion costs and the integral features allowance for lighting systems and air conditioning systems etc.

Tax legislation identifies other property items that may qualify for capital allowances, such as movable partition walls and storage and display facilities. Capital allowances may also be due when the property is “with which” the trade is undertaken rather than “in which” such as a dry dock, silo or swimming pool.

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Specific advice should be obtained before taking action, or refraining from taking action, in relation to this summary, if you would like advice or further information, please speak to your usual Shipleys contact or one of our tax specialists shown on this page.

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