Landlords have been excluded from the super deduction incentive in corporate tax liabilities at a time when they really need it, warns tax and advisory firm Blick Rothenberg
Heather Powell, a partner at the firm and head of property and construction, said: 'The deduction is seen as a massive incentive for businesses to invest, make their businesses more productive, and contribute to the UK recovery from the pandemic but landlords have not been included.’
‘The Chancellor’s budget announcements for business included a ‘Super Deduction’ of £130 for every £100 invested by companies in equipment when calculating their corporation tax liability over the next two years.
‘After 12 months in which all landlords who rent out commercial properties have been unable to enforce the payment of rent, they now are not able to claim the tax incentive that will help fund some of the works needed to make empty properties fit for UK businesses in the post pandemic world.
‘UK commercial premises are an essential cog in the infrastructure in the UK. The right premises provide the platform from which businesses grow and succeed. The super deduction, available to trading businesses, should be available to landlords to ensure business premises are fit for purpose.
‘Encouraging landlords to fund the investment needed, after a year with no income, is essential to help businesses succeed. Landlords have been deprived of income since March 2020 and they deserve, as an absolute minimum, an opportunity to benefit in this incentive.
‘Investment in abandoned retail units, restaurants, cafes and other commercial properties to make them fit for occupation to the businesses of the future by landlords has to be preferential to boarded up units on our high streets.
‘Asking landlords to pay for the investment required, and giving them some tax relief, is cheaper than any of the alternative options, and will be a massive incentive to ensure the investment is made promptly – as the incentive is only available for two years.
‘The Chancellor needs to urgently reverse his decision to exclude landlords from this tax relief – and provide just a little bit of support to beleaguered owners of now empty commercial property.’
The super deduction on capital allowances was announced at the Budget earlier this month and applies to investment in plant and machinery.