Structural Buildings Allowance
Structural Buildings Allowance (SBA) is an entirely new relief designed to write off the construction costs of a building (excluding plant). It will be available to all new commercial property owners where the development commences after 29 October 2018.
The relief is a simple straight-line deduction against profits of 2% of construction costs, excluding land, over 50 years. It is not clawed back on a sale and the benefit of any unused allowance can transfer to a new buyer.
This is a welcome shot in the arm for those owning and investing in UK commercial property and combines well with the fivefold increase to £1 million a year for two years from 1 January 2019, announced in the Annual Investment Allowance.
Perhaps in order to fund some of the SBA, capital allowances on integral plant and machinery are being reduced from 8% writing-down allowance to 6% from April 2019.
In addition, first-year allowances on the energy-efficient plant are to be phased out by 2020.
For further advice about this change visit HMRC
Newsletter containing further information coming soon from Capital Allowance Review Service!
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