What are Embedded Capital Allowances?

Embedded Capital Allowances refer to tax deductions that can be claimed by a purchaser of a property or business, for assets that are already in place within the property or business at the time of purchase. These assets are deemed to be “embedded” within the property or business, therefore their value is already included in the purchase price.

The purchaser can claim tax relief on the value of these assets, which can reduce the overall tax liability of the purchaser. This can be a significant benefit, particularly for purchasers of commercial properties or businesses, as the value of the embedded assets can be substantial.

Examples of assets that may qualify for capital allowances include, heating and air conditioning systems, lighting fixtures, and machinery. It is important to note that in order to claim capital allowances, a proper assessment must be carried out, which can involve an inspection of the property or business, and may require qualified professional services.

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Understanding Embedded Capital Allowances

Over 75% of commercial property owners are yet to make an Embedded Capital Allowances claim and miss out on their capital allowance refunds which they are entitled. Are you one of them?

As long as you own UK commercial property and pay tax in the UK, then you can claim. The following are examples of the type of commercial property that will be eligible,

  • Bars, Pubs and Restaurants
  • Care Homes,
  • Dentists and Doctors surgeries
  • Furnished Holiday Lets
  • Hotels
  • Office Buildings
  • Retail and Industrial Units.


The Capital Allowances Act 2001 provides for tax relief on expenditure that are considered Fixtures and Fittings of the commercial building. These may include,

  • Air Conditioning
  • Electrical systems
  • Emergency Lighting and Fire Detector Equipment
  • Fittings in toilets, baths, and showers
  • Heating and Ventilation systems
  • Hot and Cold-water systems
  • Kitchen Fittings and equipment
  • Lifts
  • Suspended Ceilings and Partitions

The Counting King team of tax and valuation experts will carry out thorough due diligence on property transactions. We are experts in valuing allowances on both current and historic acquisitions, making sure you get the full benefit. The team of experienced Chartered Tax Advisers can optimise and correctly categorise a claimant’s Capital Allowances.

COUNTING KING Embedded Capital Allowances Process

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Find Out How Much You Can Claim With Our FREE Embedded Capital Allowances Calculator. You can even get the calculation emailed to you for future use.

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Have you completed any work on the property?*

If the property was built or purchased before April 2014, there is no time limit on accepted claims. However, after April 2014, if the previous owner had not made a claim for Embedded Capital allowances, then all rights to claim tax relief against future ‘Fixtures and Fittings’ may not be claimed by any future buyer.

The cost of the survey will be part of Counting King’s fees, regardless of the number of properties.

Floor plans and any Building reports would be useful.

S41 Taxation of Chargeable Gains Act 1992 allows for Capital Allowance claims and that these do not affect the cost of an asset for capital gains purposes.

Yes, as there are several methods, we can use to confirm proof of expenditure.

Case Studies

How we helped a real estate developer receive a £49,000 tax relief!

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Contact us today to learn more about our embedded capital allowances and how we can help your business grow.