There are enough things to consider if you want a stress free office fit out, so it’s understandable if the tax relief opportunities that it might bring are the last thing on your mind.
Having said that, if there’s an opportunity to offset these costs, you’d obviously want to do as much as you can to benefit from it. We don’t pretend to know a great deal about tax relief here at Paramount, so we thought we’d go to the experts and asked Sara Lathwood, Lead Consultant at chartered accountants, Clay Shaw Thomas, to give us her thoughts on the subject.
Sara’s helpfully put together her guide to maximising tax relief for your next office fit out.
What should you consider?
If you are thinking of refitting or refurbishing your commercial property, the potential tax reliefs available probably aren’t a major priority, but the savings could be significant.
It’s likely that a large amount of the costs relating to an office fit out would be eligible for 100% relief against your taxable profits in the year they were incurred. However, it’s important to make sure that you seek advice in respect of any potential spending beforehand. This will ensure that tax relief is maximised by structuring the fit out in the most tax advantageous way. Keeping detailed costings from your office fit out company also means that every potential £1 of tax relief can be identified.
For example, if you are considering partitioning off separate offices within your building space, tax relief can be created simply by ensuring that the partitioning is movable and not fixed in place.
What’s available for tax relief?
Tax relief isn’t just available on the items you would expect, such as office furniture, but also on electrical and air conditioning systems under the relatively new integral features rules.
It may be that you are considering an office refit on a property that you have recently purchased, in which case there may be further tax reliefs available, which are often overlooked.
What are ‘integral features’?
It’s likely that on purchasing a building, you will have purchased along with it ‘integral features’, such as electrical and water systems. The rules concerning this are complex but, dependant on the facts of each case, it’s likely that some tax relief, and potentially a lot, will be available for the cost of the integral features that would have been included in the cost price of the building, along with any other fixtures and fittings that may have been included in the sale.
If this type of relief has not been identified and claimed at the time of a property purchase, all is not lost, there is no time limit for claiming the relief.
How can I make it as easy as possible?
The process can be complicated and confusing, so it’s always best to use the knowledge and expertise of an accountancy firm. With help and advice, you can make the right decisions that will not only result in an impressive office design but also get the most out of your tax planning.
Written by Sara Lathwood, Lead Consultant at Clay Shaw Thomas, Chartered Accountants