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Home / Simons-Taxes /Business tax /Part B5 Specific trades and activities /Division B5.4 Leases /Long funding leases of plant and machinery / B5.409 Lessees under long funding operating leases
Commentary

B5.409 Lessees under long funding operating leases

Business tax

If, in a period of account, a company or person carrying on a trade, profession or vocation is the lessee of any plant or machinery under a long funding lease which is a long funding operating lease (see B5.405), the deductions that may be allowed in computing the person's profits for the period of account are to be reduced as follows, to reflect the fact that capital allowances are due1:

  1. Ìý

    (1)ÌýÌýÌýÌý Determine the 'starting value' (or 'relevant value' for income tax purposes) (see below).

  2. Ìý

    (2)ÌýÌýÌýÌý Deduct from the starting value/relevant value the amount2:

    1. Ìý

      (a)ÌýÌýÌýÌý where the lessee has the use of the plant

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