TTM09420 | Capital allowances: Industrial buildings

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

Disposal by tonnage tax company

When the relevant interest in a used industrial building is sold, the buyer’s entitlement to IBA is calculated by reference to the seller’s residue of qualifying expenditure. This is normally worked out by reference to the original cost incurred by the seller, the allowances he has claimed and any notional allowances attributable to any periods of non-qualifying use (see CA34600).

There are special rules dealing with the disposal of the relevant interest in an industrial building by a tonnage tax company.

If such a company disposes of the relevant interest in an industrial building, which it has used for the purposes of its tonnage tax trade, then the residue of expenditure used to calculate IBA due to the buyer is worked out on the assumption that the seller had not been within tonnage tax and that he had claimed the full amount of IBA available.

References