The Chancellor has announced that with effect from April 2020 the Structures and Buildings Allowance (SBA) rate is increased from 2% to 3%.

The new SBA rate will apply to all qualifying expenditure on a non-residential building or structure which has been brought into qualifying use and where the contracts for construction were entered into on or after 29 October 2018.

  • The rate is effective from 1 April 2020 (for companies) and 6 April 2020 (for unincorporated businesses).
    • Where the expenditure was incurred, and the building or structure was brought into use before April 2020, the new rate will only apply from April 2020. The 2% rate will continue to apply up to April 2020 with the new rate applying thereafter.
    • Businesses with an accounting period that spans April 2020 will need to time apportion their allowances accordingly.
  • The period of write off will be reduced from 50 years to 33 1/3 years, meaning that some businesses will be able to claim additional relief if they were claiming allowances at the 2% rate and still own the asset after 33 1/3 years.

There are also some technical amendments to the legislation. Those which have effect from 11 March 2020 provide:

The other amendments take effect retrospectively from 29 October 2018 and allow for:

  • Reliance on verbal construction contracts as well as those in writing.
  • Relief to be available for the first day of qualifying use.
  • The use of simplified calculations for all qualifying non-residential structures or buildings.

Links to our guides

Structures and Buildings Allowance 
This is a guide to the Structures and Buildings allowance, who can claim, what expenditure is eligible and how to make a claim.

External Links

Policy paper: Capital Allowances/Increase in rate of Structures and Buildings Allowances and technical changes

Draft legislation



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