Finance Act, 1993

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Amendment of Chapter V (Urban Renewal: Relief from Income Tax and Corporation Tax) of Part I of Finance Act, 1986.

30.—(1) Chapter V of Part I of the Finance Act, 1986 , is hereby amended—

(a) in section 42—

(i) in subsection (1), by the substitution in the definition of “qualifying period” (inserted by section 29 (b) (i) of the Finance Act, 1992 ) of “the 30th day of November, 1993” for “the 31st day of May, 1993”, in each place where it occurs, and of “the 31st day of July, 1994” for “the 31st day of May, 1994”, and

(ii) in subsection (2), by the insertion of the following additional proviso to that subsection:

“Provided also that, notwithstanding section 265 (1) of the Income Tax Act, 1967 , no balancing charge shall be made in relation to a qualifying premises by reason of any of the events specified in the said section 265 (1)—

(i) which occurs more than thirteen years after the qualifying premises was first used, or

(ii) in a case where section 26 of the Finance Act, 1991 , applies and has effect, which occurs more than thirteen years after the capital expenditure on refurbishment of the qualifying premises was incurred.”,

(b) in section 44 (1), by the substitution in the definition of “qualifying period” (inserted by section 29 (c) of the Finance Act, 1992 ) of “the 30th day of November, 1993” for “the 31st day of May, 1993”, in each place where it occurs, and of “the 31st day of July, 1994” for “the 31st day of May, 1994”, and

(c) in section 45—

(i) in subsection (1) (a)—

(I) by the insertion of the following definition before the definition of “qualifying lease”:

“‘market value’, in relation to a building or structure, means the price which the unencumbered fee simple of the building or structure would fetch if sold in the open market in such manner and subject to such conditions as might reasonably be calculated to obtain for the vendor the best price for the building or structure, less the part of that price which would be attributable to the acquisition of, or of rights in or over, the land on which the building or structure is constructed;”,

(II) by the substitution in the definition of “qualifying period” (inserted by section 29 (d) (i) of the Finance Act, 1992 ) of “the 30th day of November, 1993” for “the 31st day of May, 1993”, in each place where it occurs, and of “the 31st day of July, 1994” for “the 31st day of May, 1994”,

(III) by the addition of the following proviso to the definition of “qualifying premises”:

“Provided that, where capital expenditure is incurred in the qualifying period on the refurbishment of a building or structure in respect of which an allowance falls to be made for the purposes of income tax or corporation tax, as the case may be, under the said Chapter II of Part XV or under the said Chapter I of Part XVI, the building or structure shall not be regarded as a qualifying premises unless the total amount of the expenditure so incurred is not less than an amount which is equal to 10 per cent. of the market value of the building or structure immediately before the said expenditure is incurred;”,

and

(IV) by the addition of the following definition after the definition of “qualifying premises”:

“‘refurbishment’, in relation to a building or structure, means any work of construction, reconstruction, repair or renewal, including the provision or improvement of water, sewerage or heating facilities, carried out in the course of repair or restoration, or maintenance in the nature of repair or restoration, of the building or structure.”,

and

(ii) in subsection (2), by the substitution of the following paragraph for paragraph (b) of the proviso (inserted by section 32 of the Finance Act, 1990 ) to that subsection:

“(b) where a person holds an interest in a qualifying premises out of which interest a qualifying lease is created (directly or indirectly) in respect of that qualifying premises and in respect of the qualifying lease a claim for a further deduction under this section is made, and either he or a person who is connected with him—

(i) takes under a qualifying lease a qualifying premises (hereafter in this proviso referred to as ‘the second-mentioned premises’) which is occupied by him or the person who is connected with him, as the case may be, for the purposes of a trade or profession, and

(ii) is, apart from this section, entitled, in the computation of the amount of the profits or gains of that trade or profession, to a deduction on account of rent in respect of the second-mentioned premises,

then, unless he or the person who is connected with him, as the case may be, shows that the taking on lease of the second-mentioned premises was not undertaken for the sole or main benefit of obtaining a further deduction on account of rent under the provisions of this section, he or the person who is connected with him, as the case may be, shall not be entitled in the computation of the amount of the profits or gains of that trade or profession to any further deduction on account of rent in respect of the second-mentioned premises.”.

(2) (a) Paragraph (a) of subsection (1), other than subparagraph (i) of that paragraph, shall take effect as on and from the 6th day of May, 1993.

(b) Paragraph (c) of subsection (1), other than subparagraph (i) (II) of that paragraph, shall take effect as respects rent payable in relation to any qualifying premises under a qualifying lease entered into on or after the 6th day of May, 1993.