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Advisers stand to gain from unclaimed tax relief

Financial advisers are being offered free training and introducer fees to extend their service offering to include advice on capital allowances for clients who run their own business and own a commercial property.

MoneyBee said that claiming capital allowances – a little known, but highly valuable property-related tax relief – can result in significant tax savings for business clients.

Capital allowances are available to owners of commercial property on any expenditure they have incurred buying, building or fitting out business premises.

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MoneyBee explained that the value of the tax relief can be significant. For example, if a business owner bought new premises five years ago for £500,000, the capital allowances could be worth approximately £150,000. For a business client paying higher rate tax, this equates to a potential tax rebate of £60,000.

Despite this, MoneyBee said that over 90 per cent of UK business owners fail to claim the maximum allowances they are entitled to and as a result could be sitting on a “goldmine” of unclaimed tax relief.

MoneyBee added that while some businesses and their accountants claim for obvious items such as office furniture and computer equipment, they could also claim capital allowances on fixtures like security systems, heating, lighting and ventilation systems – even expenditure on Christmas decorations, art and plants can attract tax relief in certain types of business, but those areas are usually overlooked.

Nick Small, manager for MoneyBee, said: “Business owners don’t realise there’s a hidden value in the fixtures and fittings within their premises and therefore fail to claim all the tax relief they are entitled to. Many businesses rely on their accountants to claim tax allowances, but accountants are not property specialists and therefore can’t adequately value fixtures within a property in order to extract the maximum tax relief. In essence this means businesses are paying more tax than they need to and financial advisers are ideally placed to help them reclaim what they are owed.”