Industrial Buildings Allowance (IBA) - Revision history

Editor at 18:12, 12 January 2024

2024-01-12T18:12:14Z

← Older revision		Revision as of 18:12, 12 January 2024
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	IBA allowances no longer exist. They were continuously in force from 1945 to 2008, after which they became the subject of a phased withdrawal until the financial year beginning April 1, 2011. Since then there have been no IBA writing down allowances.		IBA allowances no longer exist. They were continuously in force from 1945 to 2008, after which they became the subject of a phased withdrawal until the financial year beginning April 1, 2011. Since then there have been no IBA writing down allowances.

−	= Related articles on Designing Buildings ~~Wiki~~ =	+	= Related articles on Designing Buildings =

	* Backward integration.		* Backward integration.

Designing Buildings at 07:30, 4 January 2021

2021-01-04T07:30:27Z

← Older revision		Revision as of 07:30, 4 January 2021
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	* VAT - Protected Buildings.		* VAT - Protected Buildings.

−	[[Category:Taxation]]	+	[[Category:DCN_Definition]] [[Category:DCN_Group]] [[Category:DCN_Policy]] [[Category:Taxation]]

Editor at 15:59, 24 September 2019

2019-09-24T15:59:12Z

← Older revision		Revision as of 15:59, 24 September 2019
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	= Related articles on Designing Buildings Wiki =		= Related articles on Designing Buildings Wiki =

−	* ~~Capital allowances~~.	+	* Backward integration.
	* Business Premises Renovation Allowance.		* Business Premises Renovation Allowance.
	* Business rates.		* Business rates.
		+	* Capital allowances.
	* Research and development tax relief.		* Research and development tax relief.
	* Staircase tax.		* Staircase tax.

Designing Buildings at 14:16, 23 July 2019

2019-07-23T14:16:29Z

← Older revision		Revision as of 14:16, 23 July 2019
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	* Capital allowances.		* Capital allowances.
		+	* Business Premises Renovation Allowance.
	* Business rates.		* Business rates.
	* Research and development tax relief.		* Research and development tax relief.
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	* Tax.		* Tax.
	* VAT		* VAT
−	* VAT - Option to tax ~~(or to elect to waive exemption from VAT)~~.	+	* VAT - Option to tax.
	* VAT - Protected Buildings.		* VAT - Protected Buildings.
−	* Writing down allowances.

	[[Category:Taxation]]		[[Category:Taxation]]

Designing Buildings at 14:15, 23 July 2019

2019-07-23T14:15:45Z

← Older revision		Revision as of 14:15, 23 July 2019
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	{\|		{\|
−	\| [[File:~~Laing O Rourke precast factory~~.jpg]]	+	\| [[File:Laing_O_Rourke_precast_factory.jpg\|link=File:Laing_O_Rourke_precast_factory.jpg]]
	\|}		\|}

−	IBA was introduced by the government in its 1945 Income Tax Act to boost post-war productivity in industry. The idea was that whatever the capital cost of constructing a manufacturing or processing building (or sometimes purchasing it 'second-hand’), the person holding 'the relevant interest' in the building would receive tax relief.	+	The Industrial Buildings Allowance (IBA) was introduced by the government in its 1945 Income Tax Act to boost post-war productivity in industry. The idea was that whatever the capital cost of constructing a manufacturing or processing building (or sometimes purchasing it 'second-hand’), the person holding 'the relevant interest' in the building would receive tax relief.

	Aimed originally at productive industry, the scope of IBA was broadened to include allowances on infrastructure such as tunnels, bridges, roads used for highway concessions, qualifying hotels and commercial buildings in enterprise zones.		Aimed originally at productive industry, the scope of IBA was broadened to include allowances on infrastructure such as tunnels, bridges, roads used for highway concessions, qualifying hotels and commercial buildings in enterprise zones.

−	In effect, IBA was a 'writing down' allowance (WDA) – allowing relevant business people to deduct a percentage of the value of an item from their profits each year, which in turn meant they paid less tax – typically for around 25 years, sometimes less. Thus, IBA constituted an incentive to build ‘industrial’ facilities.	+	In effect, IBA was a writing down allowance (WDA) – allowing relevant business people to deduct a percentage of the value of an item from their profits each year, which in turn meant they paid less tax – typically for around 25 years, sometimes less. Thus, IBA constituted an incentive to build ‘industrial’ facilities.

	However, the item had to count as ‘qualifying expenditure’ that had been incurred on a building.		However, the item had to count as ‘qualifying expenditure’ that had been incurred on a building.

−	~~To receive the IBA WDA, the following conditions had to be met:~~	+	IBA was made to the person holding relevant interest in relation to the qualifying expenditure. The relevant interest is defined by the construction expenditure incurred on the building; relevant interest therefore is the interest in the building to which the person who incurred the construction expenditure was entitled to when the expenditure was incurred. A building may have had several relevant interests, as construction expenditure could have been incurred at different times and by different people.
−		+
−	# IBA was made to the person holding relevant interest in relation to the qualifying expenditure. The relevant interest is defined by the construction expenditure incurred on the building; relevant interest therefore is the interest in the building to which the person who incurred the construction expenditure was entitled to when the expenditure was incurred. A building may have had several relevant interests, as construction expenditure could have been incurred at different times and by different people.	+

	The following is an example of relevant interest given by UK tax collection service Her Majesty’s Revenue and Customs (HMRC, formerly ‘Inland Revenue’ for income tax collection):		The following is an example of relevant interest given by UK tax collection service Her Majesty’s Revenue and Customs (HMRC, formerly ‘Inland Revenue’ for income tax collection):
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	"Warren builds a factory on land that he owns. The relevant interest for the factory is the freehold interest. If Warren leases the factory to Lowell and Lowell builds an extension, the relevant interest for the extension is Lowell’s leasehold interest. So, there are two relevant interests for the factory – Warren’s freehold interest for the factory and Lowell’s leasehold interest for the extension."		"Warren builds a factory on land that he owns. The relevant interest for the factory is the freehold interest. If Warren leases the factory to Lowell and Lowell builds an extension, the relevant interest for the extension is Lowell’s leasehold interest. So, there are two relevant interests for the factory – Warren’s freehold interest for the factory and Lowell’s leasehold interest for the extension."

−	~~# The building is in qualifying use: IBA was also given on some buildings which might not be classed as industrial.~~ Buildings or constructions that qualified were:	+	Buildings or constructions that qualified were:

	* Buildings of a qualifying trade: e.g manufacturing/processing, storage, generating/transforming/converting, transmitting electrical energy		* Buildings of a qualifying trade: e.g manufacturing/processing, storage, generating/transforming/converting, transmitting electrical energy
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	= Related articles on Designing Buildings Wiki =		= Related articles on Designing Buildings Wiki =

−	* Budget.
	* Capital allowances.		* Capital allowances.
−	* Business case.
−	* Business plan
	* Business rates.		* Business rates.
−	* Cashflow.
−	* Cash flow forecast.
−	* Financial management tools.
−	* Funding options.
−	* Hourly rate.
−	* Housing Grants, Construction and Regeneration Act.
−	* PAYE.
−	* Payment for dilapidations.
	* Research and development tax relief.		* Research and development tax relief.
−	* Scheme for Construction Contracts.
	* Staircase tax.		* Staircase tax.
	* Tax.		* Tax.
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	* VAT - Option to tax (or to elect to waive exemption from VAT).		* VAT - Option to tax (or to elect to waive exemption from VAT).
	* VAT - Protected Buildings.		* VAT - Protected Buildings.
		+	* Writing down allowances.

	[[Category:Taxation]]		[[Category:Taxation]]

Editor: Created page with "{| | File:Laing O Rourke precast factory.jpg |} IBA was introduced by the government in its 1945 Income Tax Act to boost post-war productivity in industry. The idea was that..."

2019-07-16T15:19:09Z

Created page with "{| | File:Laing O Rourke precast factory.jpg |} IBA was introduced by the government in its 1945 Income Tax Act to boost post-war productivity in industry. The idea was that..."

New page

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| [[File:Laing O Rourke precast factory.jpg]]
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IBA was introduced by the government in its 1945 Income Tax Act to boost post-war productivity in industry. The idea was that whatever the capital cost of constructing a manufacturing or processing building (or sometimes purchasing it 'second-hand’), the person holding 'the relevant interest' in the building would receive tax relief.

Aimed originally at productive industry, the scope of IBA was broadened to include allowances on infrastructure such as tunnels, bridges, roads used for highway concessions, qualifying hotels and commercial buildings in enterprise zones.

In effect, IBA was a 'writing down' allowance (WDA) – allowing relevant business people to deduct a percentage of the value of an item from their profits each year, which in turn meant they paid less tax – typically for around 25 years, sometimes less. Thus, IBA constituted an incentive to build ‘industrial’ facilities.

However, the item had to count as ‘qualifying expenditure’ that had been incurred on a building.

To receive the IBA WDA, the following conditions had to be met:

# IBA was made to the person holding relevant interest in relation to the qualifying expenditure. The relevant interest is defined by the construction expenditure incurred on the building; relevant interest therefore is the interest in the building to which the person who incurred the construction expenditure was entitled to when the expenditure was incurred. A building may have had several relevant interests, as construction expenditure could have been incurred at different times and by different people.

The following is an example of relevant interest given by UK tax collection service Her Majesty’s Revenue and Customs (HMRC, formerly ‘Inland Revenue’ for income tax collection):

"Warren builds a factory on land that he owns. The relevant interest for the factory is the freehold interest. If Warren leases the factory to Lowell and Lowell builds an extension, the relevant interest for the extension is Lowell’s leasehold interest. So, there are two relevant interests for the factory – Warren’s freehold interest for the factory and Lowell’s leasehold interest for the extension."

# The building is in qualifying use: IBA was also given on some buildings which might not be classed as industrial. Buildings or constructions that qualified were:

* Buildings of a qualifying trade: e.g manufacturing/processing, storage, generating/transforming/converting, transmitting electrical energy
* Supplying water for public consumption
* Providing sewage undertakings
* Transport, inland navigation and dock undertakings (dock, wharf, pier etc)
* Tunnels
* Bridges (only if expenditure incurred after end 1956-57)
* Highways
* Undertakings for the supply of hydraulic power.

IBA allowances no longer exist. They were continuously in force from 1945 to 2008, after which they became the subject of a phased withdrawal until the financial year beginning April 1, 2011. Since then there have been no IBA writing down allowances.

= Related articles on Designing Buildings Wiki =

* Budget.
* Capital allowances.
* Business case.
* Business plan
* Business rates.
* Cashflow.
* Cash flow forecast.
* Financial management tools.
* Funding options.
* Hourly rate.
* Housing Grants, Construction and Regeneration Act.
* PAYE.
* Payment for dilapidations.
* Research and development tax relief.
* Scheme for Construction Contracts.
* Staircase tax.
* Tax.
* VAT
* VAT - Option to tax (or to elect to waive exemption from VAT).
* VAT - Protected Buildings.

[[Category:Taxation]]