Finance Act, 1989

Amendment of section 26 (allowance for certain capital expenditure on roads, bridges, etc.) of Finance Act, 1981.

17.Section 26 (as amended by section 39 of the Finance Act, 1984 ) of the Finance Act, 1981 , is hereby amended as respects any relevant agreement (within the meaning of that section) entered into on or after the 6th day of April, 1987—

(a) in subsection (1)—

(i) by the substitution, in the definition of “qualifying period”, of “1992” for “1989”, and

(ii) by the insertion after “agreement”, in the definition of “relevant expenditure”, of “, including interest on money borrowed to meet such capital expenditure”,

and the said definitions, as so amended, are set out in the Table to this section, and

(b) by the substitution for subsection (2) of the following subsection:

“(2) Where a person, having made a claim in that behalf, proves, as respects a chargeable period, that relevant income was receivable and relevant expenditure was incurred by him in the chargeable period or its basis period by virtue of the relevant agreement giving rise to the relevant income, he shall, subject to subsection (3), be entitled, for the purpose only of ascertaining the amount (if any) of that relevant income on which he is to be charged to tax—

(a) to an allowance equal to one-half of the relevant expenditure for the said chargeable period, and

(b) to an allowance equal to one-tenth of the relevant expenditure for each of the next five chargeable periods in which the said relevant income is receivable by him:

Provided that all relevant expenditure so incurred prior to the chargeable period in which relevant income is first receivable shall be deemed to have been incurred on the first day of that chargeable period.”


“qualifying period” means the period commencing on the 29th day of January, 1981, and ending on the 31st day of March, 1992;

“relevant expenditure” means capital expenditure incurred by a person during the qualifying period by virtue of a relevant agreement, including interest on money borrowed to meet such capital expenditure, but does not include any expenditure in respect of which any person is entitled to a deduction, relief or allowance under any provision of the Tax Acts other than this section;