Café refurbishment and fit-out costs — what counts as capital spend vs revenue repairs?

Hi Oliver — the rule of thumb is restoration versus improvement. Replacing your worn-out ovens with a modern equivalent and redecorating like-for-like are generally revenue repairs, deductible in the year, as long as you're simply restoring what was there rather than adding something new. A new counter and servery, new flooring or layout changes that add something that wasn't there before are capital spend, added to the balance sheet — but you can then claim capital allowances on much of it, including integral features like electrical and plumbing systems, with 100% first-year relief available where eligible. Ask your contractor for an itemised invoice splitting materials and labour by area of work, because that split is exactly what your accountant will need at year end. Getting the split agreed before the work starts is far easier than reconstructing it afterwards.