Our client is Lerwick Port Authority who has developed two quays at a cost of £26m.
What RSM did
Our team recently carried out a capital allowance review for the development work at two quays which cost in the region of £26m. Although there were no physical buildings within the development, as it was purely structural work to the docks, our team identified significant capital allowances. In addition to the more obvious items, we identified substantial building work in connection with the fixtures, something that is often missed without specialist involvement.
The original contract sum analysis was not very clear as to the nature of the expenditure. But by visiting the site, we were able to physically identify the fixtures and then extract their costs from the documentation available. Working closely with the civil engineer helped our team to fully understand the project and maximise the tax relief available.
In total the client had spent approximately £26m over two sites, and of this we identified capital allowances in excess of £2m. This will generate more than £400k of tax savings for the client who had been advised by another firm that there may only be half of that. Their immediate tax repayment is expected to be around £80k.