What are integral features for capital allowance purposes? What is the consequence of something being an integral feature? 

This a freeview 'At a glance' guide to integral features.

What is an integral feature?

Integral features are plant and machinery which are integral to a building.

Integral features come under the heading Plant and machinery but like Fixtures, have to be considered separately because they are subject to a set of different rules and Rates of capital allowances.

The integral features rules apply to expenditure incurred on or after 1 April 2008 (Corporation Tax)/ 6 April 2008 (Income Tax).

The following are integral features:

  • An electrical system (including a lighting system).
  • A cold water system.
  • A space or water heating system, a powered system of ventilation, air cooling or air purification, and any floor or ceiling comprised in such a system.
  • A lift, an escalator or a moving walkway.
  • External solar shading.

This list is exhaustive. 

Any asset whose principal purpose is to insulate or enclose the interior of a building or to provide an interior wall, floor or ceiling which is intended to remain permanently in place, will not count as an integral feature.

Special rate pool

Integral features are put into a special rate pool for capital allowance purposes.

The rate of capital allowances that apply depends on whether the expenditure is on new or unused assets, the date of purchase and the availability of the different allowances that are applicable.

Expenditure on new integral features will attract either:

If the AIA, SR allowance and 50% FYA are not available:

  • Expenditure on integral features is subject to a Reduced rate of writing down allowance (WDA) for capital allowances.
    • This is 6% from April 2019 (8% from April 2012).  

Expenditure on integral features

  • An integral feature is treated as being replaced where expenditure incurred on it is more than 50% of the cost of replacing the integral feature.
  • The effect of this measure is that the replacement expenditure is not deductible against income, instead, the cost is capitalised and subject to capital allowances.
  • The rules link up any additional expenditure in the period of 12 months beginning with the initial expenditure being incurred. If all comes to more than 50% of the cost of replacing the integral feature (worked out as if all the expenditure was incurred at the time the initial expenditure was incurred) the cost is treated as if it is spent on the acquisition of a new asset. 


Example 1:

Polly would like to replace the electrical system in her seaside restaurant.

  • She obtains an estimate from Sunnyside Electrics Ltd, who quote a total figure of £120,000 for the whole job and are recommended by her friend.
  • She decides that she cannot afford this, so requests a separate estimate for replacing the wiring and sockets on the ground floor alone, because this is the floor she is most worried about, following some recent flood damage.
  • Sunnyside Electrics Ltd quote a figure of £58,000 for this floor alone. Although it might have been possible for Polly to have obtained a cheaper estimate for replacing the whole system, for a total of say £100,000, (when £58,000 would have represented more than 50% of that total) this is not relevant.
  • The £120,000 estimate from the recommended experienced electrician was a bona fide arm’s length estimate and there is no need to enquire further.
  • The partial replacement cost represents less than 50% of the total replacement cost and so the integral features provisions do not apply.

Example 2:

  • Joe decides to replace the electrical system in his factory.
  • The cost of replacing the whole system is around £150,000.
  • Joe’s business’s chargeable period ends on 31 December each year. He pays £60,000 towards the new system on 31/12/2022 and pays the balance of £90,000 on 30/06/2023 after the work is satisfactorily completed.
  • Although Joe’s initial expenditure in his 2022 chargeable period on beginning to replace this integral feature represented only 40% of the replacement cost, that initial expenditure plus the further expenditure incurred within 12 months (that is, plus the balance incurred in his 2023 chargeable period) represented more than 50% of the replacement cost,
  • The total expenditure is deemed to be capital expenditure, to be allocated to the special rate pool, where it will attract WDAs at the special rate (unless other allowances, such as the AIA or FYA are available and claimed).

Integral Features and SDLT

See SDLT: Chattels & Fixtures

Small print and Links

Useful guides on this topic

Plant and machinery: Allowances
What are the capital allowances on plant and machinery? How do you calculate them? What are the qualifying activities?

Fixtures: Overview
What are fixtures? How do I claim lost or unclaimed fixtures? When must fixtures be pooled? What is the fixed value requirement?

Annual Investment Allowance
What is the Annual Investment Allowance? What are the limits? What expenditure qualifies?


Capital Allowances Act 2001 s.33A and s.33B

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