Capital receipts treated as income
10(1)Section 809ZB of ITA 2007 (plant and machinery leases: capital receipts to be treated as income: interpretation) is amended as follows.
(2)In subsection (6), for “subsection (9)” substitute “subsections (9) and (9A)”.
(3)In subsection (9)—
(a)in paragraph (a), insert at the end “or”, and
(b)omit paragraph (c) (and the “or” before it).
(4)After subsection (9) insert—
“(9A)Where—
(a)a capital payment is an initial payment under a long-funding lease, and
(b)under section 61 of CAA 2001 (disposal events and disposal values), the commencement of the term of the lease is an event that requires the lessor to bring a disposal value into account,
the capital payment is only “relevant” to the extent that it exceeds the disposal value.”
(9B)“Commencement”, “disposal value”, “initial payment”, “long funding lease” and “the term” have the same meaning as in Part 2 of CAA 2001.”