CA31400 - IBA: Qualifying expenditure:
Expenditure on the construction of a building
You should give IBA on capital expenditure incurred on the
construction of a building or the capital cost of buying an unused
building.
Expenditure incurred on the construction of a building
includes:
- capital expenditure on repairs, that is
expenditure on repairs for which a Case 1 deduction could not be
made
CA31450;
- the costs of demolishing an existing
building in order to erect a new building provided that those costs
are not taken into account in calculating a balancing adjustment on
the old building;
- professional fees relating to the design
and construction of a building provided that the building is
actually constructed;
and so you should give IBA on those costs.
Expenditure on the construction of a building does
not include:
- the cost of obtaining planning permission.
If, however, a builder's quotation includes the cost of obtaining
planning permission do not try to disallow that part of the
quotation;
- capitalised interest;
- the cost of a public enquiry;
- the cost of land drainage and
reclamation;
- landscaping;
- legal expenses;
and so these costs do not qualify for IBA.
