Commentary

B6.302 Tenant's obligation to carry out work

Business tax
Business tax | Commentary

B6.302 Tenant's obligation to carry out work

Business tax | Commentary

B6.302 Tenant's obligation to carry out work

If the terms of the grant of a lease impose obligations on the tenant to carry out work on the premises, the lease is treated as requiring the payment of a premium (or additional premium) to the landlord. This premium (or additional premium) is the amount by which the landlord's interest in the land (out of which the lease was granted) is increased immediately after the commencement of the lease by virtue of the obligation1.

Example

Suppose X grants an 11-year lease to Y in return for a premium of £40,000. Under the terms of

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