Capital Allowance - Rental income

recoupca said:
Central Heating forms part of the Fixtures and Fittings as far as capital allowances go if you're claiming for the building itself.

In relation to the question about calculation, search Google for "property capital allowance indicative savings'
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Exactly. The question is "can you take it with you?". Clearly, in relation to a central heating system that's not likely. So with a trade, you're in IBA territory. In a rental income scenario, I'd treat it as enhancement for CGT purposes to be included when the property is disposed of.
 
In relation to capital allowances - can you hold back a percentage of your capital allowances for the following year?
 
Holding back allowances

TillyT said:
In relation to capital allowances - can you hold back a percentage of your capital allowances for the following year?
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Yes.

In fact, if you made a profit (and therefore paid tax) for the last couple of years, you can normally claim this back straight away.

You can then spread the remaining benefit over the next 3 or 4 years.

If you haven't made a profit this year, you can carry across the whole entitlement.

In fact, if you're property company didn't make a profit, you can carry the benefit sideways in to other commercial interests that did.

Andy
[email protected]
 
Andy - are you aware that this is an Irish forum?

I note from your e-mail address that you are probably based in UK
 
recoupca said:
In fact, if you're property company didn't make a profit, you can carry the benefit sideways in to other commercial interests that did.
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Whilst I appreciate that the legislation is possibly a bit ambiguous in this area, it is Revenue's opinion that rental cap alls are ringfenced purely for use against rental income so unless you want to take Revenue to court I would advise against attempting to offset rental cap alls against other income
 
Despite the Revenue leaflet, IMO a central heating system enhances the value of the property and therefore cannot be used to claim W&T. The expenditure incurred in putting in the system can be used to reduce any CGT on the sale of the property.

You will also find that most posters on this thread agree with my interpretation
 
simplyjoe said:
So the Revenue are wrong and you and your fellow posters are right?
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There's no right or wrong as such. With issues like this it's all a matter of interpretation and IMO a central heating system is NOT claimable for Cap Alls as it adds value to a property

In fairness, if a dispute arose with Revenue over it I think it is unlikely that a Revenue Inspector could levy interest or penalties on somebody who claimed Capital Allowances on a central heating system given what is stated in the Revenue leaflet. I do however think that most Revenue Inspectors would consider a central heating system an enhancement as opposed to a fixture or fitting.
 
DB74 said:
There's no right or wrong as such. With issues like this it's all a matter of interpretation and IMO a central heating system is NOT claimable for Cap Alls as it adds value to a property

In fairness, if a dispute arose with Revenue over it I think it is unlikely that a Revenue Inspector could levy interest or penalties on somebody who claimed Capital Allowances on a central heating system given what is stated in the Revenue leaflet. I do however think that most Revenue Inspectors would consider a central heating system an enhancement as opposed to a fixture or fitting.
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+1

Revenue leaflets have no legislative basis. However, Revenue would struggle to contradict their own stated position.

It would depend on the nature of the central heating system and its level of integration. My own view is that the installation of a central heating system should generally be "enhancement" and therefore be in CGT or IBA territory.

If it's grey, you'd look at which result is more beneficial to the client and run with that.
 
db74 said:
there's no right or wrong as such. With issues like this it's all a matter of interpretation and imo a central heating system is not claimable for cap alls as it adds value to a property

in fairness, if a dispute arose with revenue over it i think it is unlikely that a revenue inspector could levy interest or penalties on somebody who claimed capital allowances on a central heating system given what is stated in the revenue leaflet. I do however think that most revenue inspectors would consider a central heating system an enhancement as opposed to a fixture or fitting.
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+1
 
If I had to replace a €400 washing machine after only 3 years...how do I deal with that? Do I have to suffer the loss?
Is this not effectively a repair???

Advice would be much appreciated
 
You get what's called a Balancing Allowance which is the difference between what you got for it and the Tax Written Down Value as at date of disposal

eg - Washing Machine bought 3 years ago @ €300

Wear & Tear in Year 1 = €300 x 12.5% = €37.50
Wear & Tear in Year 2 = €300 x 12.5% = €37.50
Wear & Tear in Year 3 = €300 x 12.5% = €37.50

Disposed in Year 4 - Proceeds of NIL
TWDV at date of disposal = €300 - €112.50 (€37.50 x 3) = €187.50

Therefore Balancing Allowance = €187.50

This figure is added to your capital allowances for Year 4, therby giving you tax relief on the loss.

You can also claim capital allowance on the replaced washing machine in Year 4, obviously at 12.5% of the cost over 8 years
 
The Revenue guidelines as set out are so insufficient it's an insult. (Check out the British system ...so so much simpler and clearcut)

www hmrc.gov.uk/manuals/pimmanual/pim3200.htm

Bad enough to be screwed the way we are being the last few years without having to tiptoe through their lazy, inadequate rulebook.
I installed double glazing last year. Am I to understand from some posters above that this can only be claimed against CGT?
 
Just spotted this. Thanks very much DB!

I'm so .....ing frustrated with this process. People like you are a godsend. Thanks again
 
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gearoidc said:
The Revenue guidelines as set out are so insufficient it's an insult. (Check out the British system ...so so much simpler and clearcut)

www hmrc.gov.uk/manuals/pimmanual/pim3200.htm

Bad enough to be screwed the way we are being the last few years without having to tiptoe through their lazy, inadequate rulebook.
I installed double glazing last year. Am I to understand from some posters above that this can only be claimed against CGT?
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as it enhances the value of the premises, i wouldnt claim capital allowances on it
 
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