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Structures and buildings allowance

B3.271 Introduction and entitlement to structures and buildings allowance

A form of capital allowance, the structures and buildings allowance (SBA), is available for expenditure on the construction of commercial (non-residential) buildings and structures. The relief extends to capital expenditure on the improvement of existing structures and buildings, including converting existing premises to qualifying business use. The detailed rules are contained in regulations made by statutory instrument under powers conferred on the Treasury by the Finance Act 2019¹.

The allowance is available for eligible construction costs incurred on or after 29 October 2018, at an annual rate of 3% (2% before 1 April 2020 for corporation tax and before 6 April 2020 for income tax), on a straight-line basis². There is a higher annual rate of 10% for freeport and investment zone qualifying expenditure³ (see below). Relief is available for UK and overseas structures and buildings, where the business is within the charge