1(1)Part 2 of ICTA (which, at sections 43A to 43G, includes provisions about rent factoring) is amended as follows.E+W+S+N.I.
(2)Section 43C(1) (section 43B not to apply where term over which financial obligation is to be reduced exceeds 15 years) shall cease to have effect.
(3)In section 43E (interposed lease: exceptions etc) in subsection (1), omit paragraphs (a) and (b) (which relate to certain periods exceeding 15 years).
(4)The amendments made by this paragraph have effect in relation to finance agreements entered into on or after 16th March 2005.
(a)a finance agreement was entered into on or after 20th March 2000 and before 16th March 2005, and
(b)section 43D of ICTA (interposed lease) would apply in relation to the agreement but for section 43E(1)(a) or (b) of that Act,
sub-paragraph (6) has effect.
(6)In any such case, any amount of principal in rent paid on or after 16th March 2005 which, apart from this sub-paragraph, would—
(a)be deductible as an expense in computing profits charged under Case I of Schedule D, or
(b)be deductible under section 75 of ICTA (expenses of management), or
(c)fall to be brought into account under section 76 of that Act (expenses of insurance companies) at Step 1 in subsection (7) of that section,
shall not be so deductible or brought into account for any accounting period ending on or after 16th March 2005.
(7)If payment of an amount of principal in rent is made on or after 16th March 2005 in respect of a rental period that falls—
(a)partly before that date, and
(b)partly on or after it,
sub-paragraph (6) has effect in relation to only so much of the payment as relates to the part of the period falling on or after 16th March 2005.
(8)In this paragraph—
“amount of principal in rent” means so much of any amount of rent payable under a lease as, in the case of the finance agreement in question, reduces the amount of the financial obligation mentioned in section 43A(1) of ICTA;
“rental period” means a period in respect of which rent is paid.