Commentary

C2.1216 Grant of a long lease out of a freehold or long lease

Capital gains tax
Capital gains tax | Commentary

C2.1216 Grant of a long lease out of a freehold or long lease

Capital gains tax | Commentary

C2.1216 Grant of a long lease out of a freehold or long lease

Where a lease for a term exceeding 50 years (a long lease, which is not a wasting asset1) is granted, in return for a premium, out of a freehold interest or another long lease, it is treated as a part disposal of the larger interest out of which it is granted2. The part disposal provisions (see Division C2.4) apply. (Those provisions do not apply where the lease is granted out of a short lease which is a wasting asset3.)

This was confirmed in R Wright4 where a sublease was granted to one of the

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