Corporation Tax Act 2010

Corporation Tax Act 2010

2010 CHAPTER 4

Introduction

Part 9: Leasing plant or machinery

Chapter 2: Long funding leases of plant or machinery

Section 369: Lessor under long funding operating lease: termination of lease

1140. This section provides for the lessor to be treated as receiving income or, depending on the circumstances, incurring a revenue expense for corporation tax purposes on the termination of a long funding operating lease. It is based on section 502G of ICTA.

1141. Whether or not income is treated as being received or a revenue expense as being incurred is determined by reference to “the termination amount” and the amounts mentioned in subsection (3)(a) to (c), but the amounts mentioned in subsection (3)(a) (amounts paid to the lessee by reference to the termination value) may not themselves be deducted (see subsection (5)).

1142. The presentation of the calculation required by section 502G of ICTA has been substantially restructured to improve the accessibility of the legislation for lessor companies and their advisers.