A lease of property for life or lives, or for a period ascertainable only by reference to a death, or which is terminable on, or at a date ascertainable only by reference to, a death, is treated as a settlement unless the lease was granted for full consideration in money or money's worth. Where a lease not granted as a lease at a rack rent is at any time to become a lease at an increased rent it shall be treated as terminable at that time1 — see I5.116. Therefore, if the rent can be increased on the death of the lessee, the lease will be treated as terminable on his death. HMRC does not regard a statutory tenancy as a lease for life for the purposes of this provision, even though the practical effect may be similar2.
Less than full consideration
Where a lease for life is granted
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