Development, Refurbishment or Fit-Out of Buildings

Where a building is developed, refurbished or fitted-out directly by the taxpayer, capital allowances on Plant and Machinery are determined by reference to and analysis of the actual development expenditure.

The value of qualifying plant and machinery in a building will vary depending on a number of factors, including the building size, specification and location. However as a guide, the cost of constructing an air conditioned office building may be made up of as much as 35% to 40% plant and machinery, whilst this could still be 20% to 30% on a less sophisticated building.

Even the most basic industrial and retail properties may contain qualifying plant and machinery accounting for up to 10% of their construction cost, proving that irrespective of the type of property, substantial savings can be made.

On refurbishment or the fitting-out of property, up to 75% of the expenditure could be eligible for capital allowances.