Finance Act, 1997

Accelerated capital allowances in relation to construction or refurbishment of certain industrial buildings or structures.

148.—(1) This section shall apply to a building or structure—

(a) which is—

(i) constructed in the Temple Bar Area in the qualifying period, or

(ii) an existing building or structure in the Temple Bar Area as on the 1st day of January, 1991, and is the subject of refurbishment in the qualifying period,

and

(b) which is to be an industrial building or structure by reason of its use for a purpose specified in paragraph (a) or (d) of section 255 (1) of the Income Tax Act, 1967 .

(2) Section 254 of the Income Tax Act, 1967 , shall apply in relation to capital expenditure incurred in the qualifying period on the construction or refurbishment of a building or structure to which this section applies as if—

(a) in subsection (1)(a) of that section “equal to one-tenth thereof” were deleted,

(b) (i) in the case where the capital expenditure is incurred on the construction of the building or structure, the following subsection were substituted for subsections (2), (2A) and (2B) of that section:

“(2) An industrial building allowance shall be of an amount equal to 25 per cent. of the capital expenditure mentioned in subsection (1).”,

and

(ii) in the case where the capital expenditure is incurred on the refurbishment of the building or structure, the following subsection were substituted for subsections (2), (2A) and (2B) of that section:

“(2) An industrial building allowance shall be of an amount equal to 50 per cent. of the capital expenditure mentioned in subsection (1).”,

and

(c) subsection (7) of that section were deleted.

(3) Section 25 of the Finance Act, 1978 , shall apply in relation to capital expenditure incurred in the qualifying period on the construction or refurbishment of a building or structure to which this section applies as if—

(a) in the case where the capital expenditure is incurred on the construction of the building or structure, the following paragraph were substituted for paragraph (b) of subsection (2) of that section:

“(b) As respects any qualifying expenditure, any allowance made under section 264 of the Income Tax Act, 1967 , and increased under paragraph (a), in respect of that expenditure, whether claimed in one chargeable period or more than one such period, shall not in the aggregate exceed 50 per cent. of the amount of that qualifying expenditure.”,

(b) in the case where the capital expenditure is incurred on the refurbishment of the building or structure, paragraph (b) of subsection (2) of that section were deleted,

and

(c) subsection (2A) (including the proviso to that subsection) of that section were deleted.

(4) For the purposes of this section, where capital expenditure is incurred in the qualifying period on the refurbishment of a building or structure to which this section applies, such expenditure shall be deemed to include the lesser of—

(a) any expenditure incurred on the purchase of the building or structure, other than expenditure incurred on the acquisition of, or of rights in or over, any land, and

(b) an amount which is equal to the value of the building or structure on the 1st day of January, 1991, other than any amount of such value as is attributable to, or to rights in or over, any land,

if the expenditure referred to in paragraph (a) or the amount referred to in paragraph (b), as the case may be, is not greater than the amount of the capital expenditure actually incurred in the qualifying period on the refurbishment of the building or structure.

(5) Notwithstanding section 265 (1) of the Income Tax Act, 1967 , in the case of a building or structure to which this section applies by reason of its use for a purpose specified in section 255(1)(a) of that Act, no balancing charge shall be made by reason of any of the events specified in section 265(1) of that Act which occurs—

(a) more than 13 years after the building or structure was first used, or

(b) in a case where section 26 of the Finance Act, 1991 , applies, more than 13 years after the capital expenditure on refurbishment of the building or structure was incurred.

(6) For the purposes only of determining, in relation to a claim for an allowance under section 254 of the Income Tax Act, 1967 , or section 25 of the Finance Act, 1978 , as applied by this section, whether and to what extent capital expenditure incurred on the construction or refurbishment of an industrial building or structure is incurred or not incurred in the qualifying period, only such an amount of that capital expenditure as is properly attributable to work on the construction or, as the case may be, refurbishment of the building or structure actually carried out during the qualifying period shall (notwithstanding any other provision of the Tax Acts as to the time when any capital expenditure is or is to be treated as incurred) be treated as having been incurred in that period; but nothing in this subsection shall affect the operation of subsection (4).

(7) Where, in relation to capital expenditure incurred in the qualifying period on the construction or refurbishment of a building or structure to which this section applies, any allowance or charge has been made under the provisions of the Tax Acts relating to the making of allowances and charges in respect of capital expenditure incurred on the construction or refurbishment of an industrial building or structure by virtue of section 42 of the Finance Act, 1986 , as applied by section 55 of the Finance Act, 1991 , that allowance or charge shall be deemed to have been made under those provisions by virtue of this section.