If you own or invest in commercial property, integral features capital allowances are one of the most valuable reliefs you can claim, and one of the most commonly under-claimed. They let you write off the cost of the building systems that make a property usable: the lifts, the heating, the ventilation, the cold water pipework and the electrical installation. These items sit in the special rate pool and attract a writing-down allowance of 6% a year, with the option of a 100% deduction up front using the Annual Investment Allowance.
What counts as an integral feature is defined exhaustively under section 33A of the Capital Allowances Act 2001, and it matters because integral features behave differently from ordinary plant and from the building shell: a different pool, a different rate, and a different set of first-year reliefs. One boundary catches a lot of people out, and getting it wrong puts a genuine error on your return: the headline new 40% first-year allowance does not reach integral features. For every allowance available on a property, see our complete guide to capital allowances for property investors.
What counts as an integral feature? The five section 33A categories
Integral features are defined exhaustively in section 33A(5) of the Capital Allowances Act 2001. There are exactly five categories, and expenditure on any of them is treated as special rate expenditure:
- An electrical system, including a lighting system. This is the system that distributes electricity around the building, from the point of supply through the wiring, distribution boards and lighting.
- A cold water system. The cold water supply and distribution pipework, but not the sanitary ware itself.
- A space or water heating system, a powered system of ventilation, air cooling or air purification, and any floor or ceiling comprised in such a system. This covers boilers, radiators, underfloor heating, air conditioning and powered ventilation. A floor or ceiling forming part of such a system is itself an integral feature, which is easy to miss and worth real money when you spot it.
- A lift, an escalator or a moving walkway. Any powered system for moving people or goods between levels.
- External solar shading. Fixed shading devices attached to the exterior of the building.
If an item does not fall into one of these five categories, it is not an integral feature. It may still qualify as ordinary plant and machinery (for example, loose fixtures, signage or specialist trade equipment), in which case it goes into the main pool rather than the special rate pool. The distinction matters because the two pools are written down at different rates and qualify for different first-year reliefs.
The five categories at a glance: what counts and what does not
Each of the five section 33A(5) categories appears here against the items you typically see on an invoice, and against the lookalikes that fall outside it. Every integral feature, whichever category it sits in, goes into the special rate pool at 6% (or can be covered by the AIA up to the cap).
| Integral-feature category (s.33A(5)) | Real-world examples | What is NOT in this category | Pool and rate |
|---|---|---|---|
| Electrical system, including lighting | Mains wiring, distribution boards, general lighting installation | Portable lamps and trade-specific machinery wiring (may be main-pool plant) | Special rate pool, 6% |
| Cold water system | Cold water supply and distribution pipework | Sanitary ware such as basins and WCs; hot water (sits under heating) | Special rate pool, 6% |
| Space or water heating, powered ventilation, air cooling or air purification, and any floor or ceiling forming part of such a system | Boilers, radiators, underfloor heating, air conditioning, powered ventilation, and the ceiling housing the AC plant | A purely decorative ceiling or floor that is not part of a system (excluded shell) | Special rate pool, 6% |
| Lift, escalator or moving walkway | Passenger and goods lifts, escalators, moving walkways | Stairs and ramps (excluded shell under List A) | Special rate pool, 6% |
| External solar shading | Fixed external brise-soleil and louvres attached to the building | Internal blinds (may be main-pool plant) | Special rate pool, 6% |
The AIA can apply to expenditure in both the main pool and the special rate pool up to the £1,000,000 cap, which usually makes it the first port of call regardless of which pool the item would otherwise sit in.
Shell, structures, integral features or plant: which box does the spend fall in?
Before you can tell whether something is an integral feature, you need the four-way split the legislation creates. Get the split right and your claim holds up; get it wrong and it falls apart on enquiry.
- The building shell is excluded. Section 21 sets out List A, which bars plant and machinery allowances for the building itself, including walls, floors, ceilings, doors, gates, shutters, windows, stairs and mains services such as water and gas pipes. The shell is not plant.
- Structures are excluded. Section 22 sets out List B, which bars allowances for structures such as bridges, roads, docks, dams, reservoirs and tunnels, and for any other structure (other than a building) that is not plant.
- List C carves some items back in. Section 23 lists expenditure that is unaffected by the section 21 and section 22 exclusions, restoring plant treatment to items that would otherwise be caught. List C includes things such as fire safety equipment, refrigeration plant, cold stores, sprinkler systems and the like. Section 23(4) reminds you that items designed mainly to insulate the building, or to form permanent walls, floors or ceilings, stay excluded.
- Integral features sit in their own category. Section 33A then takes the five integral-feature categories and routes them to the special rate pool. Without section 33A, several of these systems (for example the electrical and cold water systems) might have struggled to qualify at all; the section both confirms their eligibility and fixes the pool they go into.
This is why a floor or wall is excluded but the heating system running through it is an integral feature, and why the electrical wiring buried in the structure is claimable when the structure around it is not. Faced with a single construction or refurbishment invoice, you have to allocate each line to the right category. The table below shows where each one lands, and the allowance route and rate that follow.
| Expenditure element | Statutory box | Allowance route | Rate |
|---|---|---|---|
| Walls, floors, ceilings, doors, windows, stairs, mains water and gas pipes | Building shell, section 21 List A (excluded) | No plant and machinery allowance; the structure may attract SBA | None, or 3% SBA |
| Bridges, roads, docks, tunnels and other non-plant structures | Structures, section 22 List B (excluded) | No plant and machinery allowance; may attract SBA | None, or 3% SBA |
| Fire-safety equipment, sprinklers, refrigeration, cold stores | Plant restored by section 23 List C | Main pool, or the AIA | 14% main pool, or 100% AIA |
| Lifts, electrical, cold water, heating, ventilation, air cooling, external solar shading | Integral feature, section 33A routed to special rate by section 104A | Special rate pool, the AIA, or for a company the 50% first-year allowance | 6%, or 100% AIA |
| Loose plant, signage, trade equipment | Ordinary plant and machinery | Main pool, the AIA, or the 40% first-year allowance if new and unused | 14%, 40% FYA, or 100% AIA |
Take a single refurbishment invoice line reading "new suspended ceiling housing the air-conditioning ductwork". That ceiling forms part of a powered air-cooling system, so under category three of section 33A(5) it is an integral feature and goes into the special rate pool at 6% (or the AIA). Now take a decorative suspended ceiling installed purely to improve the look of a room: that is part of the building shell under section 21 List A, attracts no plant and machinery allowance, and at best sits within an SBA claim on the structure. Same words on the invoice, very different tax outcome, and the basis you take has to stand up if HMRC asks.
Who can claim, and the section 35 dwelling-house bar
You can claim integral features capital allowances if you have incurred capital expenditure on qualifying items in a property used for a qualifying activity, whether you let commercial property, invest in it, or occupy your own premises. The relief reaches both new construction and the purchase of second-hand commercial property, provided you meet the relevant conditions.
Residential property is much more restricted. Section 35 bars plant and machinery allowances for plant or machinery used in a dwelling-house within an ordinary property business, the position HMRC sets out in its Capital Allowances Manual at CA22000 onwards on integral features and the dwelling-house exclusion. So you cannot claim integral features allowances on the boiler or wiring inside an individual let flat or house. The important exception is common parts of a multi-unit residential building: a communal lift, a shared heating system or the lighting in the common hallway of a block of flats can qualify, because the common parts are not themselves a dwelling-house. This is a frequent area of missed relief in multi-let property; our guide to capital allowances on HMO and multi-tenant common parts works through the mechanics in detail.
One historic route has now closed. Furnished holiday lettings used to be treated as a qualifying activity that allowed wider plant and machinery claims on residential property. The furnished holiday lettings regime was abolished from 6 April 2025 for income tax (1 April 2025 for corporation tax), so that route is gone for new expenditure. Pools already established before abolition continue to be written down within the ordinary property business; see our note on FHL capital allowances after April 2025 for the transitional position.
Rates of relief: the 6% special rate pool
Integral features go into the special rate pool. The writing-down allowance for this pool is 6% a year on a reducing balance basis under section 104D of the Capital Allowances Act 2001. This means you claim 6% of the pool balance each year, and the unrelieved balance carries forward. For example, on £100,000 of integral features written down through the pool, you would claim £6,000 in year one, then 6% of the remaining £94,000 (£5,640) in year two, and so on, with the balance tailing off slowly over many years.
The main pool runs faster. The main pool writing-down allowance is 14% for chargeable periods beginning on or after 1 April 2026 (corporation tax) or 6 April 2026 (income tax), reduced from 18% by section 28 of the Finance Act 2026. A chargeable period that straddles the start date uses a hybrid, time-apportioned rate between the old and new figures. The main pool holds ordinary plant; the special rate pool holds integral features and other special rate items.
The special rate pool rate of 6% was not changed by the Finance Act 2026. The reform reduced the main pool rate but left the special rate pool where it was. So if you see a guide stating that the special rate falls to 4%, or that integral features are written down at 18%, it is wrong on both counts. Because 6% is a slow rate of relief, claiming the AIA on integral features up front is almost always preferable where the cap allows. For the wider treatment of pool rates across all asset classes, see our explainer on writing-down allowance rates.
The Annual Investment Allowance: 100% relief up front
The Annual Investment Allowance (AIA) lets you deduct 100% of the cost of qualifying plant and machinery, including integral features, in the year you incur the expenditure, up to an annual cap. The cap is £1,000,000 under section 51A(5) of the Capital Allowances Act 2001, and it is now permanent: the £1m level was confirmed on an enduring basis by Finance (No.2) Act 2023, so the older framing about a temporary cap reverting to £200,000 is out of date.
Because integral features otherwise attract only 6% a year, the AIA is usually the better choice: it brings the whole deduction into year one rather than spreading it across decades. Any expenditure above the £1m cap, or expenditure you choose not to cover with the AIA, drops into the special rate pool and is written down at 6%. The AIA is available to companies, sole traders, partnerships and LLPs alike (it is not restricted by incorporation status), and it covers special rate items as well as main pool items, with cars being the main exclusion.
For a fuller treatment of how to plan the AIA across a portfolio and within long or short accounting periods, see our guides to the Annual Investment Allowance for landlords and the Annual Investment Allowance more generally.
The Finance Act 2026 reliefs, and why the 40% allowance does not reach integral features
Claim the new 40% first-year allowance on your integral features and you have made a mistake HMRC can unwind. Section 29 of the Finance Act 2026 created that 40% first-year allowance (inserting section 45U into the Capital Allowances Act 2001) for expenditure incurred on or after 1 January 2026. But it is for main rate plant and machinery only: the new section 45U expressly excludes special rate expenditure, and integral features are special rate expenditure under section 33A. The asset must also be new and unused, so second-hand items are out as well.
In plain terms: integral features do not qualify for the 40% first-year allowance. They never can, because they are by definition special rate. The 40% allowance is aimed at new main pool plant, and in practice it is the route most relevant to those who cannot use full expensing, including unincorporated businesses such as individual landlords, sole traders and partnerships.
So what first-year route does exist for integral features?
- The AIA is the route open to everyone. It gives a 100% deduction on integral features up to the £1m cap, regardless of whether you trade as an individual, partnership or company.
- The 50% special rate first-year allowance is the route specifically for companies. A company within the charge to corporation tax can claim 50% of qualifying new and unused special rate expenditure (which includes integral features) as a first-year allowance, with the remaining 50% going into the special rate pool to be written down at 6%. This is the special rate companion to full expensing.
- Full expensing (100% first-year relief, companies only) is a main rate allowance, so like the 40% allowance it does not reach integral features. For how full expensing fits the wider picture, see our guide to full expensing capital allowances.
For integral features, then, use the AIA up to the cap (whoever you are), and if you run a company, weigh the 50% special rate first-year allowance for any spend above the cap or instead of pooling. The 40% allowance and full expensing belong to the main pool plant elsewhere in your fit-out, not to the integral features themselves.
Worked example: a £120,000 integral-features fit-out
Suppose you spend £120,000 on qualifying integral features when refurbishing a commercial unit: a new heating and ventilation system, rewiring and lighting, and an upgraded cold water system. Assume no other capital spend in the year, so the full AIA is available.
Route 1: claim the AIA. Because £120,000 is well within the £1,000,000 cap, the whole £120,000 can be deducted in year one. The relief is brought forward in full, which is almost always the best timing outcome.
Route 2: pool the expenditure at 6%. If for some reason the AIA were not available (for example, it had already been used elsewhere), the £120,000 would go into the special rate pool and be written down at 6% reducing balance: £7,200 in year one, then 6% of the remaining £112,800 (£6,768) in year two, then £6,362 in year three, and so on. After three years only around £20,000 of relief has been claimed, and the rest tails off over many more years. That slow drip is exactly why the AIA matters so much here.
Route 3: a company above the cap. If a company spent, say, £1,200,000 on integral features in a single period, it could cover £1,000,000 with the AIA, then claim a 50% special rate first-year allowance on the remaining £200,000 (£100,000 of relief in year one), with the final £100,000 entering the special rate pool at 6%. The 40% allowance and full expensing would not be available on any of it, because all £1,200,000 is special rate expenditure.
The figures show the mechanics. Which route is right for you turns on your profits, your wider tax position and when you incur the spend.
Buying second-hand: the section 198 fixtures election
When you buy a building whose fixtures a previous business owner could have claimed on, you generally cannot simply value the integral features yourself and claim on the full amount. Two requirements bite on a second-hand purchase. The pooling requirement (section 187A) means the past owner must have allocated the relevant fixtures expenditure to a capital allowances pool. The fixed-value requirement (section 187A) means the value passing to you must be fixed, normally by a joint election under section 198 of the Capital Allowances Act 2001, signed by both buyer and seller, or by a tribunal determination.
The election fixes how much of the purchase price is attributed to the fixtures, and it must be made within two years of the purchase. Get this wrong, or miss the deadline, and you can lose the right to claim on those fixtures permanently. The integral-features element of the fixtures carries through to the special rate pool, just as on new expenditure.
For the full buyer-side mechanics, including the interaction of the two gates, the £1-versus-market-value question and the negotiation points to raise during conveyancing, see our dedicated guide to claiming commercial property fixtures and the section 198 election.
Structures and Buildings Allowance versus integral features
A separate relief, the Structures and Buildings Allowance (SBA), applies to the cost of the building or structure itself where construction began on or after 29 October 2018. The SBA gives a 3% straight-line allowance a year under section 270AA of the Capital Allowances Act 2001 (uplifted from 2% with effect from April 2020). If you have seen the figure quoted as 2%, that is out of date; the current rate is 3%.
The SBA and plant and machinery allowances are mutually exclusive. The SBA is not available for anything that qualifies for plant and machinery allowances, so integral features stay in the plant and machinery regime (6% special rate pool, or AIA) and never go into the SBA. When you construct or buy a new commercial building, split the cost: the shell and structure go to the 3% SBA, while you claim the integral features and other plant separately under the plant and machinery rules. Apportion the cost soundly at the design stage and you capture both reliefs without double-counting.
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Disposal: balancing events on the special rate pool
Selling a property that includes fixtures is a disposal event for capital allowances. Under section 55, your entitlement is worked out pool by pool from the available qualifying expenditure against the total disposal receipts. Under section 61, the disposal value attributable to the fixtures is determined, and where fixtures are sold with a building the seller-side value is governed by the fixtures Table in section 196.
The practical risk is a balancing charge: if the disposal value brought into the special rate pool exceeds the remaining pool balance, the excess is a taxable receipt that claws back relief you have already had. The value passing on sale is usually fixed by the section 198 election, which is why agreeing that figure before exchange is a planning point and not an afterthought. For the full treatment of balancing allowances and balancing charges on disposal, see our guide to balancing allowances and charges on property capital allowances.
Common pitfalls and how to avoid them
Missing the section 198 election. On a second-hand purchase, failing to make a valid election within two years, or buying from a seller who never pooled the fixtures, can wipe out the claim entirely. Address it during conveyancing, not afterwards.
Assuming a let dwelling qualifies. The section 35 dwelling-house bar means you cannot claim integral features inside an individual let home. Only common parts of multi-unit buildings qualify. Mixed-use property needs the costs apportioned between the residential and commercial elements.
Mis-claiming the 40% allowance on integral features. This is the newest trap. The 40% first-year allowance is main rate only and excludes special rate expenditure, so it cannot be claimed on integral features. The route for integral features is the AIA, or for companies the 50% special rate first-year allowance.
How to make a claim
To claim integral features capital allowances, you include the expenditure in your capital allowances computation as part of your tax return. Sole traders and partnerships claim on the self-assessment return; companies claim in the corporation tax return (CT600). Keep a detailed fixed asset register recording the cost, date and category of each integral feature, and retain the analysis that supports the split between the pools and the SBA.
If you use the AIA, you claim the full cost in the period of expenditure up to the cap; the balance, if any, goes into the special rate pool at 6%. Where you are a company, weigh the 50% special rate first-year allowance against pooling for any spend you cannot or do not cover with the AIA. With Making Tax Digital for Income Tax now phasing in for landlords and sole traders, accurate, well-categorised capital records also make quarterly reporting and the year-end position far easier to stand behind.
Why specialist advice matters
Integral features capital allowances are a technical area where the value of the claim turns on correct classification, the right pool, the correct first-year route and a valid election. Getting the section 33A categories wrong, missing the section 198 election deadline, or mis-applying a relief that does not reach integral features can all cost real relief. A property accountant experienced in capital allowances can identify the qualifying expenditure, allocate it defensibly across the shell, structure, integral features and plant, and prepare the documentation HMRC expects. To understand what that involves, see what a property accountant does and how to choose a property accountant who specialises in this work.
If you are considering incorporating your property business, the treatment of integral features and the transfer of pooled assets is part of the planning. Our incorporation services can help structure the transaction so the allowances are preserved and used efficiently.
Final thoughts
The money is won or lost at three moments: when you identify every qualifying system at the time of purchase or construction, when you fix the value on a second-hand purchase with a timely section 198 election, and when you pick the right first-year route for your structure. The special rate pool runs at 6%, the AIA brings the relief forward to 100% up to the £1,000,000 cap, and the Finance Act 2026 reliefs sit firmly on the main pool side of the line, not on integral features. Get the categories right and claim them in time, and on a meaningful capital spend the difference is substantial.
Sources
- legislation.gov.uk: Capital Allowances Act 2001 s.33A: integral features (five categories)
- legislation.gov.uk: CAA 2001 s.21: buildings exclusion (List A)
- legislation.gov.uk: CAA 2001 s.22: structures exclusion (List B)
- legislation.gov.uk: CAA 2001 s.23: expenditure unaffected by s.21 and s.22 (List C)
- legislation.gov.uk: CAA 2001 s.104A: definition of special rate expenditure (includes s.33A integral features)
- legislation.gov.uk: CAA 2001 s.104D: special rate pool writing-down allowance (6%)
- legislation.gov.uk: CAA 2001 s.51A: Annual Investment Allowance maximum (£1,000,000)
- legislation.gov.uk: CAA 2001 s.198: election to apportion sale price on sale of fixtures
- legislation.gov.uk: CAA 2001 s.270AA: Structures and Buildings Allowance (3%)
- legislation.gov.uk: CAA 2001 s.45U: first-year qualifying expenditure for the 40% allowance (excludes special rate expenditure)
- legislation.gov.uk: Finance Act 2026 s.28: main rate writing-down allowance reduced from 18% to 14%
- legislation.gov.uk: Finance Act 2026 s.29: 40% first-year allowance for main rate expenditure (inserting CAA 2001 s.45U)
- gov.uk: Claim capital allowances: what you can claim on - GOV.UK