Corporation Tax Act 2010 section 332D

Expenditure on acquisition of asset: disqualifying conditions

Section 332D sets out two disqualifying conditions that prevent investment expenditure on acquiring an asset from qualifying for the supplementary charge investment allowance, primarily to stop the same asset generating allowance more than once.

• Investment expenditure on acquiring an asset is not relievable if either of two disqualifying conditions applies to that asset.
• The first disqualifying condition is triggered where any company has previously incurred expenditure on the same asset (whether by acquiring, leasing, creating or enhancing it) that was already relievable under the investment allowance rules.
• The second disqualifying condition applies where the asset relates to equity in a qualifying oil field and earlier expenditure on the asset would have been relievable had the investment allowance legislation been in force at the time that earlier expenditure was incurred.
• Special rules extend both conditions to cover situations where expenditure was incurred before an area was officially determined to be an oil field, provided the area has subsequently become a qualifying oil field.