Year-End Corporation Tax Planning for Theme Parks: Capital Expenditure, R&D and Ride Upgrades

As year-end approaches, theme parks have a valuable opportunity to reduce their corporation tax bill through smart planning. Well-timed investments in equipment, ride upgrades, or technology can lead to significant tax savings, and focusing on efficiency in your year-end planning is crucial for maximising these benefits. Apex Accountants supports UK amusement park operators with specialist advice on capital expenditure, R&D claims and ride development costs. We understand the specific tax challenges parks face, from engineering costs to safety upgrades and seasonal staffing. This article outlines how to approach year-end corporation tax planning for theme parks, including tax-efficient strategies to minimise liabilities. It also covers the Annual Investment Allowance, R&D relief, ride refurbishments, and capital allowances. A simple planning checklist is also included to help you prepare.

Claim the £1 Million Annual Investment Allowance (AIA)

The current AIA limit remains at £1 million per accounting period for qualifying plant and machinery (these are qualifying assets for AIA).

For a theme park, this could include:

• Ride machinery and control systems
• Electrical infrastructure and lighting rigs
• Maintenance vehicles and park-wide tools
• HVAC systems and distribution boards

Acquiring capital assets such as these before the end of the tax year ensures you maximise available reliefs on qualifying assets. Buying and commissioning these assets before your year-end allows you to deduct their full cost from taxable profits. These purchases are considered a tax-deductible expense for corporation tax purposes.

Combine Innovation with Tax Relief — R&D Tax Credits

Theme park upgrades involving bespoke engineering or software development may qualify for R&D relief under the merged scheme introduced in 2024, offering valuable tax benefits for companies making such claims.

Common qualifying R&D projects in this sector:

• Custom ride‑control systems
• Novel ride-movement mechanisms
• Emergency braking designs
• Interactive technology installations

You can claim:

• Staff salaries and NICs
• Software and consumables
• Prototype materials
• Subcontractor fees (if directly involved in R&D)

R&D claims can also provide income tax relief for certain owner-managers or directors, depending on their remuneration structure.

Incorporating R&D claims into your overall tax planning for theme parks can significantly improve your post-year-end financial position, including potential reductions in corporation tax and enhanced cash flow.

Use Research & Development Capital Allowances (RDAs)

Capital expenditure on plant and machinery used solely for R&D qualifies for a 100% Research and Development Allowance (RDA) in year one (these are a form of enhanced capital allowances available for qualifying R&D investments), with no monetary upper limit.

For theme parks, this might apply to:

• Motion test rigs for ride development
• Custom-built mechanical platforms
• Dedicated in-house R&D facilities
• Prototyping hardware for interactive attractions

You must choose between claiming AIA or RDA — both cannot be applied to the same asset.

Plan Ride Upgrades and Refurbishments Carefully

Not all upgrades qualify equally. Identify which elements fall under capital allowances and which may qualify for R&D. It is crucial to correctly identify qualifying assets, as this ensures you can maximise available tax relief and avoid missing out on valuable allowances.

Examples:

• New electrics or lighting = AIA
• Re-engineered ride control = R&D or RDA
• Advanced safety systems may qualify under both, depending on the scope

Accurate classification helps reduce errors and increase total tax savings. Working with our corporation tax guidance for theme parks can help you make confident and well‑supported decisions on where and how to claim.

Business Asset Disposal and Relief for Theme Parks

When selling or replacing major attractions in a UK theme park business, Business Asset Disposal Relief (BADR) can affect personal tax liabilities for individuals. It does not apply to companies.

BADR Rules (January 2026)

BADR applies only to individuals, not limited companies. You may qualify if you dispose of:

• A sole trader or partnership trading business
• Business assets sold after cessation
• Shares in a personal trading company

You must meet the trading conditions. Additionally, you must have owned the business or shares for at least two years before disposal.

The lifetime limit remains £1 million per individual.

For disposals made between 6 April 2025 and 5 April 2026, BADR reduces Capital Gains Tax to 14%. From 6 April 2026 onwards, the BADR rate increases to 18%.

Company Asset Sales

When a limited company sells rides, rollercoasters, or themed installations, the gain is subject to corporation tax, usually at 25%. BADR does not apply to these sales.

However, shareholders may still qualify for BADR when they later:

• Sell shares in the trading company
  
• Dispose of shares following liquidation
  

All BADR conditions must still be met.

Planning and Optimisation

Correct timing and structure are critical. Individuals planning disposals should:

• Confirm trading status
  
• Check ownership periods
  
• Review whether a disposal can occur before 6 April 2026
  

Early planning helps secure the 14% BADR rate before it rises. Professional advice helps protect relief, manage tax exposure, and support reinvestment into new attractions or long-term exit plans.

Prepare for April 2025 Tax Changes

By January 2026, the April 2025 tax changes are already in force. Theme park operators should now review how these rules have affected their tax position and forward planning.

Corporation tax continues at 25% for companies with taxable profits above £250,000. This rate has applied since April 2023 and did not increase in April 2025. Businesses with profits below £50,000 still benefit from the small profits rate, with marginal relief applying between the thresholds.

The Annual Investment Allowance remains fixed at £1 million on a permanent basis. This allows full tax relief on qualifying capital expenditure in the year of purchase. Ride upgrades, safety systems, energy improvements, and new attractions often qualify. Many amusement parks used this relief during 2024–25. Those that described assets correctly achieved faster tax relief.

R&D tax relief rules changed again from April 2024, with the merged scheme fully embedded by April 2025. Claims now operate under tighter compliance rules, higher evidence standards, and revised rates. Innovative ride engineering, safety technology, queue-management systems, and digital visitor platforms can still qualify when structured correctly.

Theme park operators should now:

• Review capital allowance claims already submitted for 2024–25
  
• Confirm AIA was applied to the correct assets
  
• Assess R&D eligibility under the merged scheme
  
• Correct any missed or underclaimed reliefs
  
• Plan capital spend visible for the 2025–26 accounts
  

Tax planning after April 2025 requires accuracy, not assumptions. HMRC scrutiny remains high. A structured review helps control tax exposure, protect cash flow, and support reinvestment during peak trading seasons.

A proactive tax strategy keeps amusement parks financially resilient while margins remain under pressure.

Practical Year-End Tax Planning Checklist

• Review upcoming capital plans – To gauge if spending exceeds AIA cap
• Prioritise asset purchases – To claim deductions in current period
• Identify technical projects – To assess R&D and RDAs’ eligibility
• Record development stages – Required for HMRC compliance
• Categorise costs – For accurate allocation of reliefs
• Review reliefs and claims from the previous tax year – Check for carryback or adjustment opportunities
• Ensure deferred tax calculations are up to date – Reflect any changes in tax rates for year-end reporting
• Review accounting periods – Optimise timing of reliefs and ensure compliance with new rules
• Get professional advice – Rules may change or overlap

Clear and timely tax planning for theme parks can free up cash for reinvestment and reduce surprises near payment deadlines.

How Apex Accountants Supports Year-End Corporation Tax Planning for Theme Parks

Apex Accountants brings deep sector knowledge and hands-on experience in supporting theme parks with complex tax planning. We go beyond compliance to help you identify hidden savings, improve cash flow, and reinvest confidently into your rides, facilities, and guest experience.

Our team works closely with park operators to structure capital expenditure, assess R&D opportunities, and time reliefs for maximum impact. We understand the technical and seasonal nature of your operations — from machinery upgrades to safety innovations and staff costs.

If you want to improve your tax position and reduce liabilities, speak to Apex Accountants. For complex year-end corporation tax planning, it is worth seeking professional advice to ensure you maximise tax reliefs and achieve optimal tax efficiency. We offer practical advice, tailored reviews, and corporation tax guidance for theme parks that aligns with both your commercial goals and HMRC compliance.