Section 37B: Consideration on certain disposals: structures and buildings allowances, Taxation of Chargeable Gains Act 1992

This section applies on the disposal of an asset by a person if—

the asset is an interest in a building or structure which is "an interest in UK land" (as defined in section 1C) or an equivalent interest in land outside the United Kingdom,

the person is, or has been, entitled to an allowance under Part 2A of CAA 2001 ("the structures and buildings allowance") by reference to the building or structure, and

the expenditure by reference to which the structures and buildings allowance has been made is allowable under section 38 as a deduction from the consideration in the computation of the gain on the disposal.

In determining the amount of any gain accruing to the person making the disposal (the "transferor") the consideration for the disposal is treated as being increased by an amount equal to the amount of the structures and buildings allowance that has been made to the transferor.

If the disposal is—

a disposal on which, by virtue of any of the no gain/no loss provisions, neither a gain nor a loss accrues to the person making the disposal,

a disposal in respect of which section 162 (roll-over relief on transfer of business) applies for the purposes of computing the gain on the disposal, or

a deemed disposal under section 579(4) of CTA 2010 (real estate investment trusts: cessation),

the person who acquires the asset (the "transferee") is treated, for the purposes of determining the amount of the gain accruing on any subsequent disposal of the asset by the transferee, as if the amount of structures and buildings allowance made to the transferor (see subsection (2)) had been made to the transferee.

Subsection (2)—

is to be applied after the other provisions of this Act which apply for the purposes of determining the amount of the consideration deemed to be given for the disposal of assets, and

is subject to subsections (5) to (7).

If section 45(3) or 47(2) applies in relation to the disposal, subsection (2) applies in relation to the part of the consideration apportioned in the same proportion as the expenditure qualifying for capital allowances.

Subsection (7) applies in relation to the disposal if the asset mentioned in subsection (1) is—

a leasehold interest by reference to which section 270DD of CAA 2001 (leases granted for 35 years or more) applies, and

a wasting asset for the purposes of this Act.

For the purposes of subsection (2), the amount of the structures and buildings allowance is to be treated as if it were an amount of expenditure attributable to the asset under section 38(1) and, accordingly, as if it had been reduced at the same rate at which that expenditure is written off in accordance with paragraph 1(3) and (4) of Schedule 8 (leases of land as wasting assets).

The reference in subsection (1)(b) to an allowance under Part 2A of CAA 2001 includes a reference to a contribution allowance made by reason of the application of sections 537 and 538A of that Act (contribution allowances: structures and buildings allowances).

Section 37B: Consideration on certain disposals: structures and buildings allowances

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