Part 21

Leasing arrangements: finance leases and loans
Chapter 2

Finance leases with return in capital form

Capital allowances: clawback of major lump sum

Capital allowances deductions: films
921
1
This section applies if—
a
any relevant film deduction has been allowed to the current lessor (“L”) in respect of expenditure incurred in connection with the leased asset, and
b
the amount or value of the major lump sum exceeds so much of that sum as was treated as receipts of a revenue nature under section 40A(2) of F(No.2)A 1992 (disposal proceeds of original master version of film treated as receipt of a revenue nature).
2
In subsection (1) “relevant film deduction” means any deduction as a result of—
a
section 40B(1) of F(No.2)A 1992 (allocation of expenditure on master versions of films to periods), or
b
section 42 of that Act (relief for production or acquisition expenditure in respect of films).
3
L is treated as if receipts of a revenue nature arose to L from the trade or business in question on the relevant occasion.
4
The amount of those receipts is equal to the excess mentioned in subsection (1)(b).