B6.313 Definitions

Business tax
Business tax | Commentary

B6.313 Definitions

Business tax | Commentary

B6.313 Definitions

Short-term lease

A short-term lease is in one whose effective duration is 50 years or less1.

Effective duration of a lease

The following rules are to be applied when determining the effective duration of a lease—

Rule 1



    (a)     the terms of the lease or other circumstances mean that it is unlikely that the lease will continue beyond a date before the end of the term for which the lease was granted, and


    (b)     the premium payable was not substantially greater than it would have been had the lease been drafted to expire on that date,

then the lease is treated as ending on that date (or the earliest such date)2.

Rule 2

If the lease terms include provisions for the extension of the lease beyond a particular date by notice to be given to the tenant, one may take

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