As a result, leading property tax and finance specialist Davis Langdon Crosher & James – the UK’s largest consultancy advising on property tax relief – is launching a specialist service advising the motor retail industry on capital allowances for integrating sustainable design in car showrooms.
“Incorporating sustainable design comes at a cost but what a lot of dealerships don’t realise is that there are options to offset some of those costs in the form of Enhanced Capital Allowances (ECA’s),” says David Rees, Davis Langdon Crosher & James Partner. “A tax consultant will need to take the lead on ECA’s very early in the design process however, otherwise the opportunity to maximise tax relief of this nature will be lost.”
Enhanced Capital Allowances (ECA’s) were introduced to the UK tax system in 2001 as part of the UK government’s commitment under the Kyoto Agreement to reduce UK carbon dioxide emissions by 20% by the year 2010.
Designed to reward investment in the most innovative energy-saving technologies; The Carbon Trust has since approved more than thirteen thousand products from fifteen differing technology groups for inclusion on the Energy Technology List.
The benefits include the installation of ECA compliant equipment attracting 100% First Year Tax Allowances against gross operating profits in the year of expenditure for clients who can make use of the benefit. Also, operating costs are reduced through energy efficient design and increased performance aids accreditation of improved BREEAM ratings. This is a benefit to any project whether for tax relief purposes or not.
The Carbon Trust is also offering 0% interest, unsecured loans of up to £100,000 for up to four years towards expenditure on ECA items such as the upgrading or replacement of lighting, boilers or insulation and the like.
Rees comments: “Today’s car showroom has an important part to play in helping a customer to make a viable purchase decision at the same time as demonstrating corporate social responsibility. As such, it is a contributing factor to the success of the motor retail business. In today’s brand-driven society, developing sustainable car showrooms is a fact of the future.
“We find ourselves with a lot of change to manage in Capital Allowances. Nevertheless, change is often the driver of opportunity and those who take an early and positive stance on the new system are likely to do best from it and maintain their competitiveness.”
Davis Langdon Crosher & James is the UK's leading property taxation and finance consultants. They have analysed over twenty thousand properties and have historically secured tax savings of more than £2 billion on behalf of clients.
