243Rules for determining effective duration of leaseU.K.
(1)The following rules apply for determining the effective duration of a lease for the purposes of this Chapter.
Rule 1: If—
(a)the terms of the lease or any other circumstances make it unlikely that the lease will continue beyond a date before the end of the term for which the lease was granted, and
(b)the premium was not substantially greater than it would have been had the term been one ending on that date,
the lease is treated as ending on that date (or the earliest such date).
Rule 2: If the terms of the lease include provision for the extension of the lease beyond a given date by notice given by the tenant, account may be taken of any circumstances making it likely that the lease will be so extended.
Rule 3: If the tenant or a person connected with the tenant is, or may become, entitled to a further lease or the grant of a further lease (whenever commencing)—
(a)of the same premises, or
(b)of premises including the whole or part of the same premises,
the term of the lease may be treated as continuing until the end of the term of the further lease.
(2)The rules are to be applied in accordance with section 244.
(3)In Rule 1, “” includes—
(a)an amount treated as a premium under section 218 (amount treated as lease premium where work required),
(b)a sum payable by the tenant under the terms subject to which the lease is granted instead of the whole or a part of the rent for a period,
(c)a sum payable by the tenant under the terms subject to which the lease is granted as consideration for the surrender of the lease, and
(d)a sum payable by the tenant (otherwise than by way of rent) as consideration for the variation or waiver of a term of the lease.
(4)In this section and section 244, in relation to Scotland, “term”, where referring to the duration of a lease, means period.