Revenue Note for Guidance
Where expenditure is incurred on a new installation and that expenditure includes expenditure, which will enable the new installation to increase its capacity or improve its productivity, then the amount of expenditure qualifying for relief under this Part is restricted to the costs of relocation only. Provision is made to allow an Inspector of Taxes (or on appeal, the Appeal Commissioners) to determine on a just and reasonable basis the amount of the improvement expenditure related to the increased capacity or improvement.
(1) A new installation is an improved installation where its capacity is greater or where it has improved efficiency or productivity beyond what would be considered to be the normal modernisation or upgrading of the old installation.
(2) Where expenditure on an improved installation includes expenditure on new machinery or plant or new industrial buildings or structures, then the expenditure qualifying for relief under section 380T(1)(b) or section 380U(b) is that expenditure reduced by the amount of the improvement expenditure. The amount representing improvement expenditure is to be determined on a just and reasonable basis by the Inspector of Taxes or on appeal, by the Appeal Commissioners.
Relevant Date: Finance Act 2021