Business Premises Renovation Allowance

Business Premises Renovation Allowance (BPRA) is an extremely valuable tax relief which is often overlooked in our experience.  BPRA applies to most renovation expenditure incurred in bringing a disused commercial property back into use. Although the expenditure is capital in nature, BPRA allows qualifying expenses to be set off against  income.

So, for a 45% income tax payer who incurs renovation expenses of £50,000, an income tax saving of £22,500 is available.

BPRA was designed to stimulate development and regeneration in locations which may otherwise be overlooked by investors. Many of the areas designated for BPRA  fall within Merseyside.

We give below a summary of the conditions:

To qualify, the property must: 

  • Be commercial and must have last been used for the purposes of a trade, profession, vocation or as offices; 
  • Have been empty for 1 year before renovation costs are incurred to bring it back into use for the purposes of trade, profession, vocation or as offices ( there are some excluded trades – but it’s fair to say that most small and mid-sized enterprises will qualify) 
  • Be in a designated area. 

You can find details of which areas are classified as assisted and are therefore areas where BPRA is available at

            http://www.opsi.gov.uk/si/si2007/uksi_20070107_en.pdf

Qualifying expenditure is capital expenditure incurred: 

  • To convert a qualifying building into qualifying business premises 
  • To renovate a qualifying building that is, or will be, a qualifying business premises 
  • To repair qualifying business premises

Most normal building expenditure will qualify including the cost of labour and materials, surveying, planning, architectural and design services,

Next steps

If you believe you may be eligible to make a claim for BPRA, the sooner you begin the process the more likely you will be to receive any available tax relief. The scheme is set to end on 5 April 2017 for individuals and 31 March 2017 for companies.

The above gives only the main areas to consider. If you think you might be eligible to make a claim for BPRA, please contact us for help.