Capital Allowances Act 2001 section 539

Industrial buildings

Section 539 deals with how a contributor who makes a capital contribution towards another person's expenditure on constructing an industrial building can be treated as having incurred that expenditure themselves, and how industrial buildings allowances follow the relevant interest in the land.

• Where a contributor (C) makes a capital contribution towards another person's (R's) expenditure on constructing an industrial building used for a qualifying trade, C is treated as if they had incurred expenditure on, and were using, a similar industrial building to R's.
• This enables C to claim industrial buildings allowances in their own right, as though the contribution were expenditure on a comparable building.
• The entitlement to industrial buildings allowances follows the relevant interest in the land held by C, so that the allowances are linked to ownership of that interest rather than to C personally.
• If C subsequently sells or transfers the relevant interest in the land (within the writing-down period), the new holder of that interest becomes entitled to the industrial buildings allowances from the chargeable period of the transfer onwards.