4(1)After section 25 of TCGA 1992 (non-residents: deemed disposals) insert—U.K.
(1)This section applies where plant or machinery is used for the purpose of leasing under a long funding lease.
(2)The lessor shall be deemed for all purposes of this Act—
(a)to have disposed of the plant or machinery at the commencement of the term of the lease at the value described in subsection (4)(a) or (b), and
(b)to have immediately reacquired it at the same value.
(3)The lessor shall also be deemed for all purposes of this Act—
(a)to have disposed of the plant or machinery on the termination of the lease for a consideration equal to the termination amount, and
(b)to have immediately reacquired it for the same consideration.
(4)The value mentioned in subsection (2)(a) is—
(a)where the lease is a long funding finance lease, an amount equal to that which would fall to be recognised as the lessor's net investment in the lease if accounts were prepared in accordance with generally accepted accounting practice on the date on which the lessor's net investment in the lease is first recognised in the books or other financial records of the lessor, or
(b)where the lease is a long funding operating lease, an amount equal to the market value of the plant or machinery at the commencement of the term of the lease.
(5)For the purposes of this section, the following expressions have the meaning given in Chapter 6A of Part 2 of the Capital Allowances Act (interpretation of provisions about long funding leases)—
“commencement”, in relation to the term of a lease,
“lessor”,
“long funding lease”,
“long funding finance lease”,
“long funding operating lease”,
“market value”,
“the term”, in relation to a lease,
“termination”,
“termination amount”.”
(2)The amendment made by this paragraph has effect where the commencement of the term of the lease is on or after 1st April 2006.