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Capital Allowances Act 2001

Section 328: Balancing adjustment on realisation of capital value

1111.This section is based on sections 4(1)(dd), 4A(1), 5(2A) and (9A)(a) and (b) of CAA 1990. It provides an additional balancing event if capital value is realised in respect of a building which is or has been an industrial building in an enterprise zone. “Capital value” is defined in section 331(1).

1112.Subsection (2) prohibits a balancing event within this section from giving rise to a balancing allowance.

1113.Subsection (3) provides that the proceeds from the balancing event are to be taken as the amount of capital value realised.

1114.Subsection (4) provides two special rules for calculating a balancing adjustment when there is a balancing event under this section.

1115.Subsection (5) provides that capital value is realised if capital value is paid in respect of a subordinate interest in land to which the relevant interest in the building is or will be subject. Subsection (6) gives the date that capital value is realised as the date that payment is made.

1116.Subsection (7) provides that “the amount of capital value realised” in subsection (3) is the capital value that is attributable to the subordinate interest under section 329.

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