CA30300 - IBA: outline: conditions for making a claim

»Ê¹ÚÌåÓýappre are three main conditions to satisfy. »Ê¹ÚÌåÓýappse are summarised here but you will find more information by using the links.

  1. »Ê¹ÚÌåÓýapp building must be in qualifying use

An industrial building is a building or structure in qualifying use.

Qualifying use is:

  • use for the purposes of a qualifying trade although some buildings are specifically excluded from IBAs CA32310
  • use as a qualifying hotel CA32400, or
  • use as a qualifying sports pavilion CA32500, or
  • use as a commercial building, but only in relation to qualifying enterprise zone expenditure CA37000.

»Ê¹ÚÌåÓýapp main qualifying trades are manufacturing or processing and certain types of storage. Some undertakings carried on by way of trade are also qualifying trades. In the case of enterprise zones only CA37000, an office building can qualify even if it is not used for the purposes of a trade.

»Ê¹ÚÌåÓýapp period over which the expenditure is written off begins when the building is first used unless there are initial allowances available.

  1. »Ê¹ÚÌåÓýapp expenditure must be qualifying expenditure

»Ê¹ÚÌåÓýapp IBA on a building is based on the qualifying expenditure CA33500. »Ê¹ÚÌåÓýapp qualifying expenditure on a building is the capital expenditure incurred by the person who constructs the building or by the person who buys it unused from a property developer. Once the qualifying expenditure has been fixed and the building has been brought into use the qualifying expenditure never changes no matter how often the building changes hands.

  1. »Ê¹ÚÌåÓýapp person must hold the relevant interest in the building

IBA on a building is made to the person holding the relevant interest CA33000 in that building.

Broadly, the relevant interest in a building is the interest in the building to which the person who incurred the construction expenditure was entitled when that construction expenditure was incurred. This is normally a freehold or leasehold interest. »Ê¹ÚÌåÓýappre is a wider definition for those operating a highway undertaking CA38000.