Taxation (International and Other Provisions) Act 2010

New lease of land after assignment or surrender: right to new lease existed pre-22 June 1971

41 (1) Sub-paragraphs (2) and (3) apply if—

(a) each of conditions A to D in section 681BA of ITA 2007, or each of conditions A to D in section 850 of CTA 2010, is met (new lease granted to, or to person linked with, lessee under assigned or surrendered lease),

(b) condition E in that section is not met (condition that no right to new lease existed before 22 June 1971), and

(c) the rent under the new lease is payable by a person within the charge to income tax.

(2) No part of the rent paid under the new lease is to be treated as a payment of capital.

(3) The provisions of ITTOIA 2005 providing for deductions or allowances by way of income tax relief in respect of payments of rent apply in relation to the rent under the new lease.

(4) Section 681BM of ITA 2007 (meaning of “rent” etc) applies for the purposes of this paragraph.