TTM09410 - Capital allowances: Industrial buildings
There are no IBA writing down allowances for Financial Year 2011 onwards. See CA30101.
Balancing charges
Before entering tonnage tax a company may have claimed IBA on a building or structure used for the purposes of its tonnage tax trade. If the company disposes of that building or structure (or another disposal event occurs in respect of that building or structure), a balancing charge may arise.
Limit to market value
The sale, insurance, salvage or compensation moneys to be brought into account in computing the balancing charge are limited to the market value of the relevant interest in the industrial building or structure as at the time of the company’s entry into tonnage tax.
Phasing out of balancing charges
Balancing charges arising on industrial buildings or structures are also phased out in the same way as balancing charges arising on machinery or plant.
Any balancing charge is reduced by reference to the number of complete years that the company has been within the regime, as follows:
| ### Number of complete years since entry | ### Percentage reduction |
|---|---|
| 1 | 0.15 |
| 2 | 0.3 |
| 3 | 0.45 |
| 4 | 0.6 |
| 5 | 0.75 |
| 6 | 0.9 |
| 7 or more | 1 |
This table is the same as that used for phasing out balancing charges on plant and machinery (see TTM09210).