The latest research indicates that UK commercial property owners
have lost an estimated £100m in tax relief due to an obscure change
in tax law.

The start of April saw a change in regulations, with a limit set
on how soon after buying property owners could claim tax allowances
for spending on plant, equipment and machinery.

Sums involved in the loss are significant, as this expenditure
can include basics such as air-conditioning, lifts, lighting and
even carpets.  Indeed, up to 85 per cent of a building's
fit-out costs can be eligible for capital allowances.

The new rules state that the owner must make the claim for
allowances within two years of the purchase: there was no time
limit under the previous regime.

As a result of the change, an estimated £100m in capital
allowances have been lost through building sales since the
beginning of the financial year.  Catax Solutions - who are
responsible for the research - said that the relevant capital
allowances had only been claimed in just 1 per cent of the 3,000
commercial property sales that occurred in the UK between April and
June.

HM Revenue & Customs made the change in an attempt to cut
down on property owners making fraudulent claims.

Catax managing director Mark Tighe said:

"We have watched in frustration as Britain's commercial property
owners throw away an absurd amount of money in tax relief month
after month due to a lack of understanding and knowledge of capital
allowances."

The details of the change are relatively complex, with Mr Tighe
noting that many people were "struggling to get their heads around
capital allowances and the changes introduced".

He also noted that a wave of legal challenges could be the
result of the change.

"We have grave concerns that this is just the tip of the
iceberg", he said, noting the prospect of "accusations of
negligence followed by complex and protracted legal proceedings as
more and more property owners discover they could be missing
out".

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