372AN Eligible expenditure: lessors.

(1) Expenditure is eligible expenditure for the purposes of this Chapter where it is—

(a) expenditure incurred on—

(i) the construction of a house, other than a house referred to in subparagraph (ii), or

(ii) the necessary construction of a house which fronts on to a qualifying street or is comprised in a building or part of a building which fronts on to a qualifying street,

(b) conversion expenditure, or

(c) refurbishment expenditure.

(2) In this Chapter “conversion expenditure” means, subject to subsection (3), expenditure incurred on—

(a) the conversion into a house of—

(i) a building which fronts on to a qualifying street or the site of which is wholly within a tax incentive area other than the site of a qualifying park and ride facility, or

(ii) a part of a building which fronts on to a qualifying street or the site of which is wholly within a qualifying urban area or a qualifying town area,

where the building or, as the case may be, the part of the building has not been previously in use as a dwelling, and

(b) the conversion into 2 or more houses of—

(i) a building which fronts on to a qualifying street or the site of which is wholly within a tax incentive area other than the site of a qualifying park and ride facility, or

(ii) a part of a building which fronts on to a qualifying street or the site of which is wholly within a qualifying urban area or a qualifying town area,

where before the conversion the building or, as the case may be, the part of the building had not been in use as a dwelling or had been in use as a single dwelling,

and references in this Chapter to “conversion”, “conversion into a house” and “expenditure incurred on conversion” shall be construed accordingly.

(3) For the purposes of subsection (2), expenditure incurred on the conversion of a building or a part of a building includes expenditure incurred in the course of the conversion on either or both of the following—

(a) the carrying out of any works of construction, reconstruction, repair or renewal, and

(b) the provision or improvement of water, sewerage or heating facilities,

in relation to the building or the part of the building, as the case may be, or any outoffice appurtenant to or usually enjoyed with that building or part, but does not include—

(i) any expenditure in respect of which any person is entitled to a deduction, relief or allowance under any other provision of the Tax acts, or

(ii) any expenditure attributable to any part (in this subsection referred to as a “non-residential unit”) of the building or, as the case may be, the part of the building which on completion of the conversion is not a house.

(4) For the purposes of subsection (3)(ii), where expenditure is attributable to a building or a part of a building in general and not directly to any particular house or non-residential unit (within the meaning given by that subsection) comprised in the building or the part of the building on completion of the conversion, then such an amount of that expenditure shall be deemed to be attributable to a non-residential unit as bears to the whole of that expenditure the same proportion as the total floor area of the non-residential unit bears to the total floor area of the building or the part of the building, as the case may be.

(5) (a) For the purposes of this Chapter “refurbishment expenditure” means expenditure incurred on—

(i) (I) the refurbishment of a specified building, and

(II) in the case of a specified building the site of which is wholly within a qualifying town area, the refurbishment of a facade,

or

(ii) the refurbishment of a special specified building,

other than expenditure attributable to any part (in this subsection and in subsection (6) referred to as a “non-residential unit”) of the building which on completion of the refurbishment is not a house.

(b) For the purposes of paragraph (a), where expenditure is attributable to—

(i) the specified building, or

(ii)the special specified building,

as the case may be, in general and not directly to any particular house or non-residential unit comprised in the building on completion of the refurbishment, then such an amount of that expenditure shall be deemed to be attributable to a non-residential unit as bears to the whole of that expenditure the same proportion as the total floor area of the non-residential unit bears to the total floor area of the building.

(6) For the purposes of subsection (5)—

“special specified building” means a building or part of a building—

(a) in which before the refurbishment to which the refurbishment expenditure relates there is one or more than one house, and

(b) which on completion of that refurbishment contains, whether in addition to any non-residential unit or not, one or more than one house;

“specified building” means—

(a) a building which fronts on to a qualifying street or the site of which is wholly within a tax incentive area other than the site of a qualifying park and ride facility, or

(b) a part of a building which fronts on to a qualifying street or the site of which is wholly within a qualifying urban area or a qualifying town area,

and in which before the refurbishment to which the refurbishment expenditure relates—

(i) there is one or more than one house—

(I) in the case of a building, the site of which is wholly within a qualifying rural area, or

(II) in the case of a building or part of a building, the site of which is wholly within a qualifying town area,

and

(ii) there are 2 or more houses—

(I) in the case of a building or part of a building which fronts on to a qualifying street or the site of which is wholly within a qualifying urban area, or

(II) in the case of a building the site of which is wholly within a qualifying student accommodation area,

and which on completion of that refurbishment contains, whether in addition to any non-residential unit or not—

(A) in the case of a building or part of a building to which paragraph (i) applies, one or more than one house,

(B) in the case of a building or part of a building to which paragraph (ii) applies, 2 or more houses.

(7) Other than in relation to a special qualifying premises, references in this section to the construction of, conversion into, or, as the case may be, refurbishment of, any premises shall be construed as including references to the development of the land on which the premises is situated or which is used in the provision of gardens, grounds, access or amenities in relation to the premises and, without prejudice to the generality of the foregoing, as including in particular—

(a) demolition or dismantling of any building on the land,

(b) site clearance, earth moving, excavation, tunnelling and boring, laying of foundations, erection of scaffolding, site restoration, landscaping and the provision of roadways and other access works,

(c) walls, power supply, drainage, sanitation and water supply, and

(d) the construction of any outhouses or other buildings or structures for use by the occupants of the premises or for use in the provision of amenities for the occupants.