1(1)Section 61 of CAA 2001 (disposal events and disposal values) is amended as follows.U.K.
(2)In the Table in subsection (2), for item 5A substitute—
| “5A. Commencement of the term of a long funding finance lease of the plant or machinery. | The greater of— (a) the market value of the plant or machinery at the commencement of the term of the lease, and (b) the qualifying lease payments.” |
(3)After subsection (5) insert—
“(5A)In item 5A of the Table “qualifying lease payments” means the minimum payments under the lease (including any initial payment), excluding the following—
(a)so much of any payment as, under generally accepted accounting practice, falls (or would fall) to be treated as the gross return on investment in respect of the lease,
(b)so much of any payment as represents charges for services, and
(c)so much of any payment as represents qualifying UK or foreign tax (within the meaning of section 70YE) to be paid by the lessor.”
(4)Omit subsections (6) to (9).