Capital Allowances Act 2001 section 28

Thermal insulation of buildings

Section 28 sets out when expenditure on adding thermal insulation to buildings qualifies as plant and machinery expenditure eligible for capital allowances.

• Spending on adding heat-loss insulation to a building you occupy for a qualifying activity (other than a property business) is treated as qualifying expenditure on plant and machinery
• If your qualifying activity is a UK or overseas property business, the expenditure qualifies where it relates to insulation added to a building you let out in that business
• The relief is not available for property businesses where the insulation is for a dwelling-house, or where the expenditure already qualifies for a separate tax deduction as energy-saving expenditure
• When testing whether the energy-saving deduction applies, you ignore the specific rule in those provisions that would otherwise deny the deduction where capital allowances are available