Capital allowances on Renewables

If you are in business and are considering spending large amounts of money on wind turbines, solar panels and other renewable energy equipment over the next few years, now is the time to get started.

The current tax regime favours capital expenditure giving 100% tax relief on costs up to £100,000. This is due to change from April next year, when the 100% relief falls from £100,000 to £25,000 per annum and relief for the balance of the cost is spread over a much longer period than currently perhaps as much as 36 years before you get the full tax relief!
The maximum you can claim will depend on your business year end so you need to seek professional advice before you commit yourself. In addition some types of equipment may continue to qualify for 100% relief if they are on the Government approved list, so again ask your accountant before you buy.

The feed-in tariffs are also due to change from April 2012, so there is a window of opportunity to maximise your income and your tax relief.

May 2011

Property Tax

Planning for changes
The increase in Capital Gains Tax (CGT) to 28% for higher rate taxpayers is going to have a huge impact on the taxation of gains on property in the future. Coupled with the changes to the Income Tax treatment of Furnished Holiday Lettings from 6 April 2011 which prevent the set off of losses against other income and the freezing of the nil rate band for the next 5 years for Inheritance Tax purposes, the tax landscape for property is changing rapidly. Further changes to the Furnished Holiday Lettings rules apply from 6 April 2012, increasing the requirements for number of days to be available for letting to 210 days and actually let to 105 days in a year. There has never been a more important time for property owners to review their situation and to start to plan to take advantage of opportunities available now –“while stocks last!” 

May 2011

Tax Savings?

Has somebody just rung you up and offered you a tax saving that looks too good to be true? 

My general view on this is if it looks too good to be true it probably is too good to be true!  However there are a number of robust tax schemes out there and if you are keen on an exciting life and the tax saving is enough, it may be worth considering – but not before you apply the “smell” test – simply this – if it doesn’t smell right it probably isn’t!
In order to test this out you need to ask the following questions:

• Does the scheme have a DOTAS number?
• Will the scheme organisers let you see Counsel’s opinion?
• If you see Counsel’s opinion – how much of the scheme does it cover?

If you do go in for one of these you need to make sure that you disclose the DOTAS number to HMRC.  This will mean you will be investigated.  It is then very important that it is the scheme provider who deals with the administration of the investigation, rather than you or your agent.
Using one of these schemes is a bit like putting money on the horses – but somebody has to get lucky!

October 2010