New capital allowance for commercial buildings – Structures and Buildings Allowance (SBA)

The Autumn 2018 Budget announced a new 2% straight line tax deduction for the cost of construction or renovation of commercial buildings and structures.

Unlike the old Industrial Buildings Allowance the new relief, SBA, is available for the construction of shops and offices as well as factories and warehouses.  SBA can also apply to conversions of properties from one use to another.  And can apply to structures such as roads and car parks.

The Structures and Buildings Allowance gives a tax deduction against business profits.  The deduction is 2% of the cost of the building, construction or renovation.  This is not clawed back on eventual sale of the business, indeed the allowance passes on to the new buyer.

As with all of our tax tips and web pages this information is necessarily summarised and of a general nature.  If you would like detailed specific advice please contact us.