TTM09400 | Capital allowances: Industrial buildings

There are no IBA writing down allowances for Financial Year 2011 onwards. See CA30101.

Buildings used in a tonnage tax trade

The definition of an industrial building or structure includes a building or structure used for the purposes of a transport undertaking or a dock undertaking (see CA32200 onwards). It is therefore entirely possible that some assets to be used for the purposes of a company’s tonnage tax trade would qualify under the normal capital allowances regime for industrial buildings allowances.

However, no capital allowances of any kind are available to a tonnage tax company in respect of expenditure on any assets used for its tonnage tax trade.

Where any identifiable part of an industrial building or structure is used for the purposes of a company’s tonnage tax trade, that part is treated for IBA purposes as being used otherwise than as an industrial building or structure (see CA32650).

Balancing charges

Balancing charges on industrial buildings within tonnage tax are phased out using the same percentages as for plant and machinery, (see TTM09410).

Residue of qualifying expenditure after sale

There are special rules for calculating the buyer’s entitlement to IBA, (see TTM09420).

Company leaves tonnage tax

Similar provision apply to the computation of unrelieved qualifying expenditure when a company leaves tonnage tax, (see TTM09430).