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Capital expenditure…which tax relief?

Shared from Tax Insider: Capital expenditure…which tax relief?
By Sarah Bradford, January 2022

Sarah Bradford explains how tax relief may be given for capital expenditure. 

The tax system distinguishes between capital and revenue expenditure, and different mechanisms exist to confer relief for that expenditure. 

Capital expenditure is incurred on items that are retained within the property business and which either form part of the land or structure or are used to generate revenue. In the context of a property business, items of capital expenditure will include the land and property itself, and fixtures and fittings, furnishings and domestic appliances.  

Different ways of securing relief 

Not all capital expenditure is equal. In some cases, relief is available when computing the profits of the business, whereas for other items of expenditure, relief is only given when computing the eventual gain or loss on the sale of the property. 

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