Commentary

B5.410 Leases—anti-avoidance provisions for assets other than land: overview

Business tax
Business tax | Commentary

B5.410 Leases—anti-avoidance provisions for assets other than land: overview

Business tax | Commentary

Leases—anti-avoidance: assets other than land

B5.410 Leases—anti-avoidance provisions for assets other than land: overview

There are anti-avoidance provisions which prevent a person (X) from obtaining excessive tax relief in the following circumstances:

  1.  

    (a)     X holds an asset (a relevant asset) for which he obtains tax relief (see below) for rentals under a lease which provides for a very high rent for the first few years

  2.  

    (b)     thereafter X pays a nominal amount of rent for the asset, so that his lease has a value which he can realise

  3.  

    (c)     X sells their interest in the lease to Y for a capital sum

  4.  

    (d)     if X wishes to continue using the asset X can obtain a sub lease from Y

In many cases X will have

To continue reading
View the latest version of this document, as well as thousands of others like it, sign in to TolleyLibrary or register for a free trial