Glossary · UK
What is Structures and Buildings Allowance (SBA)?
A 3% per year straight-line capital allowance on qualifying expenditure on new commercial structures and buildings.
Full Definition
The Structures and Buildings Allowance (SBA) was introduced for qualifying expenditure incurred on or after 29 October 2018 on the construction, conversion, or renovation of non-residential structures and buildings. It provides a 3% per year straight-line deduction on the original qualifying cost, regardless of ownership changes -- meaning the relief is attached to the building, not the owner, and a subsequent purchaser continues to claim on the seller's original cost for the remaining allowance period. The allowance is available for UK and overseas structures where the qualifying activity is chargeable to UK tax. SBA is available to businesses subject to Corporation Tax and Income Tax (including landlords of commercial property and furnished holiday lettings). It does not apply to residential property, land, and certain other excluded assets. Unlike the Annual Investment Allowance (AIA), SBA cannot accelerate deductions -- it is always 3% per year, giving a 100% write-off over approximately 33.3 years. In a year of acquisition or disposal, the allowance is apportioned on a daily basis. SBA replaced the old Industrial Buildings Allowance and Hotel Buildings Allowance, which were phased out by 2011.