Currently, tax relief is available on the costs of turning redundant business properties into usable ones in areas of the country categorised as ‘disadvantaged’, such as much of Hull and some surrounding areas. This is called the Business Premises Renovation Allowance.
So, if you renovate or convert an unused building, you may be able to claim many of the associated costs against profits of your business, even if you then let out the regenerated building. The associated costs available for relief include costs of planning, design, construction and, in some cases, project management. There are some limits to the relief you receive. You can only claim for costs up to £20 million and if you sell the premises within five years, some or all of the relief may be clawed back.
There is more bad news. The BPRA ends at the end of March 2017 for incorporated businesses and on 5th April 2017 if you are unincorporated. If, therefore, you are looking at undertaking such a renovation you should ensure that you have committed to (but not necessarily have paid for) as much of the expenditure as possible ahead of these deadlines.
As ever, please call us for further details and guidance on this potentially lucrative tax break.
