Modifications etc. (not altering text)
C1S. 45H(2) modified (with effect in accordance with s. 167 of the amending Act) by Finance Act 2003 (c. 14), Sch. 30 para. 7
Part 2U.K. Plant and machinery allowances
Modifications etc. (not altering text)
C2Pt. 2 modified (24.2.2003) by Proceeds of Crime Act 2002 (c. 29), s. 458(1), Sch. 10 para. 12 (with Sch. 10 para. 17(1)); S.I. 2003/120, art. 2, Sch. (with arts. 3 4) (as amended (20.2.2003) by S.I. 2003/333, art. 14)
Chapter 17U.K. Anti-avoidance
[F1Finance leaseback: parties' income and profitsU.K.
Textual Amendments
F1Ss. 228A-228J and cross-heading inserted (with effect in accordance with s. 134(3) of the amending Act) by Finance Act 2004 (c. 12), s. 134
228CLessee’s income or profits: termination of leasebackU.K.
(1)Subsection (2) applies where the leaseback terminates.
(2)For the purpose of the calculation of income tax or corporation tax, the income or profits of the lessee from the relevant qualifying activity for the period in which the termination occurs shall be increased by an amount calculated in accordance with subsection (3).
(3)The calculation is—
where—
“ Net Consideration ” means—
(a) the consideration payable to S for entering into the relevant transaction, minus
(b) the restricted disposal value,
“ Current Book Value ” means the net book value of the leased plant or machinery immediately before the termination, and
“ Original Book Value ” means the net book value of the leased plant or machinery at the beginning of the leaseback.
(4) In this section “ relevant qualifying activity ” means the qualifying activity for the purposes of which the leased plant or machinery was used immediately before the termination.
(5)Section 228B has no effect on the treatment for the purposes of income tax or corporation tax of amounts received by way of refund on the termination of a leaseback of amounts payable under it.
(6) In subsection (5), “ amounts received by way of refund ” includes any amount that would be so received in respect of the lessee’s interest under the leaseback if any amounts due to the lessor under the leaseback were disregarded. ]