Planning to buy a commercial property in the UK? Sounds wonderful! Here are the benefits you can enjoy if you are looking to buy property-

• Freedom to utilise or alter the property as per your business requirements.
• Flexibility to manage the building.
• Easily sublet part of your property to another business to have another income stream added.
• Generate higher profit by selling property when it gains value.

Commercial property requires a considerably higher amount of investment capital, so the UK government offers tax benefits to encourage investors to invest. Here are the top benefits-

Capital Gain

Commercial property owners can benefit from “Business asset disposal relief”, which allows them to pay less capital gain tax on property or assets owned and used by the business. As per the tax rules, you must pay only 10% CGT on your qualifying assets. However, you are required to own and use assets in the business for at least two years before you become eligible for tax relief.

Capital Allowance

Commercial property owners enjoy the benefit of capital tax allowance. As business owners, you can claim the capital expenses that are necessary to increase your working capabilities.

Stamp Duty Land Tax

This tax on commercial properties is considered lower than what you can pay when purchasing residential property.

Flat Conversions 

Suppose the commercial property owner decides to convert the upper floors to residential flats to accommodate staff. In such cases, he can make VAT savings as the VAT on direct labour and material costs will decrease to just 5% from 20%.

VAT Refunds

As commercial property owners, you can charge VAT on the rental payments from the property. If you opt to charge for VAT, it can be recovered on specific costs and expenses such as redecoration and renovation. When you get VAT refunds, you can assist the owner in property maintenance.

Tax on commercial property is lower than on residential properties in the UK as the government has introduced business-friendly policies. If you want to ensure that you pay the correct amount of tax by the time it is due, some firms can assist you with commercial property tax advisory services.

By availing these tax benefits, you can enjoy the following-

• Avoid steep rental costs.
• Increased capital value as time passes.
• Complete control.
• Lower monthly costs.

As commercial mortgages are considered a low-cost financing method, you can rent part or all of your premises to other businesses if you wish.

Looking for a real estate expert to help you?

Hafsons is here to help as per your business requirements! 

As one of the trusted names in the UK, we provide you with the best services and support required for renting out your properties. Visit our website and get in touch with our experts to learn how they can assist you.