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  • Philip Nickson & Co Ltd

    Chartered Accountants and Registered Auditors
    Tel: 01285 810099
    Email: info@philipnickson.co.uk

  • Philip Nickson & Co Ltd

    Chartered Accountants and Registered Auditors
    Tel: 01285 810099
    Email: info@philipnickson.co.uk

Fixtures and fitting on transfer of ownership
07/08/2018

The tax treatment of the sale of fixtures and fittings included in the sale or purchase of a commercial building changed from April 2014. From that date, the buyer of a building that contains fixtures can only claim plant and machinery allowances (PMA) if the expenditure on the fixtures is pooled before the sale.

The seller and buyer must also either:

  • formally agree a value for fixtures within 2 years of a transfer
  • start formal proceedings to agree the value within that time

The formal agreement to satisfy the fixed value requirement is usually achieved when the buyer and the seller make a valid tax election known as a Section 198 claim.

This election effectively binds both the seller and purchaser of a commercial property to an agreed valuation for fixtures and fittings included in the sale. The election is irrevocable and cannot be subsequently changed.

There is a lower Writing Down Allowances (WDA) rate of 8% available for certain long life assets and integral features. A standard 18% WDA is available for fixtures and fittings that do not qualify for the lower 8% rate.


Philip Nickson & Company Ltd. Chartered Accountants, Paradise Farm, High Street, Kempsford, Fairford, Gloucestershire, GL7 4EU
Registered to carry out audit work in the UK & Ireland by the Institute of Chartered Accountants in England and Wales
Registered in England & Wales No. 5439384.