Part 21 Leasing arrangements: finance leases and loans

Chapter 3 Other finance leases

Introduction

926 Purpose of this Chapter
(1) The main purpose of this Chapter where there are arrangements to which this Chapter applies is, in relation to a company entitled to the lessor's interest under the lease of the asset, to apply the charge to corporation tax on income to amounts determined as mentioned in subsection (2).
(2) The amounts referred to in subsection (1) are determined by reference to the amounts that fall for accounting purposes to be treated, in accordance with generally accepted accounting practice, as the income return on and after 26 November 1996 on investment in respect of the finance lease or loan.
(3) The amounts referred to in subsection (1) are also determined taking into account the substance of the matter as a whole, including, in particular, the state of affairs—
(a) as between connected persons, or
(b) within a group of companies,
as reflected or falling to be reflected in accounts of any of those persons or in consolidated group accounts.