Corporation Tax Citation, commencement and interpretation 1 1 These Regulations may be cited as the Energy-Saving Items (Corporation Tax) Regulations 2008, shall come into force on 7th July 2008, and shall have effect in respect of expenditure incurred on or after 8th July 2008. 2 In these Regulations— “ ICTA 1988 ” means the Income and Corporation Taxes Act 1988; “deduction” means a deduction allowed under section 31ZA of ICTA 1988 (deduction for expenditure on energy-saving items); “maximum amount” shall be construed in accordance with regulation 3(1); “relevant expenditure” means— expenditure incurred in acquiring and installing an energy-saving item in a dwelling-house, or in so far as it is for the benefit of a dwelling-house, expenditure incurred in acquiring and installing an energy-saving item in a building containing that dwelling-house. Items of an energy-saving nature 2 The following descriptions of items of an energy-saving nature are specified for the purposes of section 31ZA(5) of ICTA 1988— a hot water system insulation; b draught proofing; c cavity wall insulation; d solid wall insulation; e floor insulation; and f loft insulation. Restrictions on relevant expenditure to be taken into account: general 3 1 The maximum amount of the relevant expenditure which may be taken into account in calculating the deduction is £1,500 per dwelling-house. 2 Paragraph (1) applies irrespective of the number of persons incurring relevant expenditure or entitled to a deduction in respect of a dwelling-house. 3 If the company entitled to the deduction has received a contribution from any other person towards the relevant expenditure incurred, that contribution shall be excluded in calculating the relevant expenditure incurred by the company entitled to the deduction. 4 Further rules (to be applied in the order stated) are set out in— a regulation 4 (first further rule: apportionment of relevant expenditure benefiting more than one property); b regulation 5 (second further rule: restriction of relevant expenditure to the maximum amount); c regulation 6 (third further rule: apportionment of relevant expenditure if a dwelling-house or building is owned jointly or in common or is subject to differing estates or interests). First further rule: apportionment of relevant expenditure benefiting more than one property 4 1 This regulation applies to relevant expenditure which is incurred in acquiring and installing an energy-saving item— a in more than one dwelling-house, b in a building containing more than one dwelling-house, or c in a building containing one or more dwelling-houses and one or more properties which are not dwelling-houses. 2 The relevant expenditure must be apportioned on a just and reasonable basis to all the properties which benefit from it. 3 The amount of the relevant expenditure for which a deduction is allowable in respect of a dwelling-house shall not exceed the amount which is apportioned to that dwelling-house. Second further rule: restriction of relevant expenditure to the maximum amount 5 1 This regulation applies if the relevant expenditure benefiting a particular dwelling-house (including any relevant expenditure apportioned to the dwelling-house under regulation 4) exceeds the maximum amount. 2 The relevant expenditure must be restricted to the maximum amount. Third further rule: apportionment of relevant expenditure if a dwelling-house or building is owned jointly or in common or is subject to differing estates or interests 6 1 This regulation applies if relevant expenditure is incurred benefiting a dwelling-house and the dwelling-house or the building containing it— a is owned jointly or in common by the company entitled to the deduction and by other persons, or b is subject to differing estates or interests. 2 The relevant expenditure (restricted if necessary to the maximum amount) must be apportioned on a just and reasonable basis. 3 The amount of the deduction to which the company entitled to it is entitled shall not exceed the amount apportioned to that company in accordance with paragraph (2). Further provisions 7 1 This regulation applies if any question arises under regulations 3(3) or 4 to 6 as to the amount of the deduction to which a company may be entitled. 2 The amount shall be treated as if it were an amount specified in a paragraph of subsection (1) of section 42 of ICTA 1988 (appeals against determinations under sections 34 to 36 or Chapter 4 of Part 3 of the Income Tax (Trading and Other Income) Act 2005) , and the procedure set out in that section shall apply accordingly. Claire Ward Frank Roy Two of the Lords Commissioners of Her Majesty’s Treasury 11th June 2008