Proprietary golf clubs urged to make Capital Allowance Tax claim

All proprietary golf clubs in the UK have been urged to make a Capital Allowance Tax claim before next year’s April Budget, when the tax allowance is ended after 62 years.

A spokesman for Malpasso, which works with golf clubs on reclaiming the tax, stated that over 90 per cent of clubs have not made a claim, even though they could recoup several thousands of pounds.

“The reason why is startling,” said a spokesman, “most managers of businesses, and even accountants, are simply unaware that this tax break exists!

“All proprietary golf clubs contain items that constitute ‘plant and machinery’. When purchasing such a property, it is possible to claim capital allowances on a proportion of the consideration for the property; in accordance with the provisions of Capital Allowances Act (CAA) 2001, section 562 (this can be researched via www.hmrc.gov.uk).

“The basic rule is that ‘qualifying expenditure’ for tax allowance purposes is capital expenditure on the provision of plant and machinery wholly or partly for purposes of the qualifying activity carried on by the person (or company) incurring expenditure. That person or company must also own the plant or machinery as a consequence of incurring the expenditure (CAA 2001, s11(4)).

“Anybody can make a claim, it’s a right not a privilege, but it is quite a complex procedure involving forensic surveyors in addition to specialist tax accountants. A proprietary golf club should expect to achieve tax allowances in the £50,000 to £100,000 range.”

Currently, clubs are allowed to make a claim going back years with no time bar, however a discussion document released recently by HMRC confirms that there will be a change to this at the April 2012 Budget that will disallow claims over two years.