- Latest available (Revised)
- Original (As enacted)
Finance Act 2009, Section 71 is up to date with all changes known to be in force on or before 23 December 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.
Revised legislation carried on this site may not be fully up to date. Changes and effects are recorded by our editorial team in lists which can be found in the ‘Changes to Legislation’ area. Where those effects have yet to be applied to the text of the legislation by the editorial team they are also listed alongside the legislation in the affected provisions. Use the ‘more’ link to open the changes and effects relevant to the provision you are viewing.
Whole provisions yet to be inserted into this Act (including any effects on those provisions):
(1)Chapter 5 of Part 3 of ITEPA 2003 (taxable benefits: living accommodation) is amended as follows.
(2)In section 105 (cash equivalent: cost of accommodation not over £75,000)—
(a)in subsection (3), after “is” insert “ (subject to subsections (4) and (4A)) ”, and
(b)for subsection (4) substitute—
“(4)Subsection (4A) applies where—
(a)a rental amount is payable by the person (“P”) at whose cost the accommodation is provided in respect of the whole or part of the taxable period (“the relevant period”), and
(b)the amount so payable is payable at an annual rate greater than the annual value.
(4A)Where this subsection applies—
(a)subsection (3) does not apply to the relevant period, and
(b)instead the “rental value of the accommodation” for the relevant period is the rental amount payable by P in respect of the relevant period.
(4B)A reference in subsection (4) or (4A) to a rental amount payable by P in respect of the relevant period is to the sum of—
(a)any rent for the period payable by P, and
(b)any amount attributed to the period in respect of a lease premium (see sections 105A and 105B).”
(3)After that section insert—
(1)For the purposes of section 105(4B)(b) an amount is attributed to the relevant period “in respect of a lease premium” if—
(a)the property consists of premises, or a part of premises, that are subject to a lease,
(b)the premises are not mainly used by P for a purpose other than the provision of living accommodation to which this Chapter applies,
(c)the lease is for a term of 10 years or less, and
(d)the net amount payable by P in relation to the lease by way of lease premium is greater than zero.
(2)The amount so attributed is—
where—
A is the relevant period (in days),
B is the term of the lease (in days), and
C is the net amount payable by P in relation to the lease by way of lease premium.
(3)For provision about the application of this section in relation to certain leases with break clauses, see section 105B.
(4)For the purposes of this section the net amount payable by P in relation to a lease by way of lease premium is—
(a)the total amount (if any) that has been paid, or is or will become payable, by P in relation to the lease by way of lease premium, less
(b)any amount within paragraph (a) that has been repaid or is or will become repayable.
(5)In this section and section 105B “lease premium” means any premium payable—
(a)under a lease, or
(b)otherwise under the terms on which a lease is granted.
(6)In the application of this section to Scotland “premium” includes a grassum.
(1)This section applies to a lease (“the original lease”) that contains one or more relevant break clauses.
(2)For the purposes of this section—
(a)“break clause” means a provision of a lease that gives a person a right to terminate it so that its term is shorter than it otherwise would be, and
(b)a break clause contained in the original lease is “relevant” if the right to terminate the lease that it confers is capable of being exercised in such a way that the term of the original lease is 10 years or less.
(3)For the purposes of section 105A—
(a)the term of the original lease, and
(b)the net amount payable by P in relation to the lease by way of lease premium,
are to be determined on the assumption that any relevant break clause is exercised in such a way that the term of the lease is as short as possible.
(4)If a relevant break clause is not in fact exercised in such a way that the term of the original lease is as short as possible, the parties to the lease are treated for the purposes of section 105A as if they were parties to another lease (a “notional lease”) the term of which—
(a)begins immediately after the time at which the term of the original lease would have ended, if that break clause had been so exercised, and
(b)ends at the time mentioned in subsection (5).
(5)The term of a notional lease ends—
(a)at the time the term of the original lease would end, on the assumption that any relevant break clause that is exercisable only after the beginning of the term of the notional lease is exercised in such a way that the term of the original lease is as short as possible, or
(b)if earlier, the tenth anniversary of the beginning of the term of the original lease.
(6)For the purposes of section 105A the net amount payable by P in relation to a notional lease by way of lease premium is, in the case of a notional lease the term of which ends under paragraph (a) of subsection (5)—
(a)the net amount that would be payable by P in relation to the original lease by way of lease premium on the assumption mentioned in that paragraph, less
(b)any part of that amount that has already been attributed to a period in respect of a lease premium under section 105(4B)(b).
(7)For the purposes of section 105A the net amount payable by P in relation to a notional lease by way of lease premium is, in the case of a notional lease the term of which ends under paragraph (b) of subsection (5), the relevant proportion of—
(a)the net amount that would be payable by P in relation to the original lease by way of lease premium, on the assumption that no break clause is exercised, less
(b)any part of that amount that has already been attributed to a period in respect of a lease premium under section 105(4B)(b).
(8)In subsection (7) “the relevant proportion” means—
where—
D is the term of the notional lease (in days), and
E is the sum of—
(a) the term of the notional lease (in days), and
(b) the number of days by which the term of the original lease would exceed 10 years, on the assumption that no break clause is exercised.”
(4)The amendments made by this section have effect in relation to—
(a)any lease entered into on or after 22 April 2009, and
(b)subject to subsection (5), any lease entered into before that date the term of which is extended on or after that date.
(5)In relation to a lease of the kind mentioned in subsection (4)(b) the amendments made by this section have effect—
(a)as if the additional term of the lease created by the extension were the whole of the term of the lease, and
(b)ignoring any lease premium payable in respect of the unextended term of the lease.
(6)In this section “ ” has the same meaning as in sections 105A and 105B of ITEPA 2003.
The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Whole Act you have selected contains over 200 provisions and might take some time to download.
Would you like to continue?
The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
Latest Available (revised):The latest available updated version of the legislation incorporating changes made by subsequent legislation and applied by our editorial team. Changes we have not yet applied to the text, can be found in the ‘Changes to Legislation’ area.
Original (As Enacted or Made): The original version of the legislation as it stood when it was enacted or made. No changes have been applied to the text.
Geographical Extent: Indicates the geographical area that this provision applies to. For further information see ‘Frequently Asked Questions’.
Show Timeline of Changes: See how this legislation has or could change over time. Turning this feature on will show extra navigation options to go to these specific points in time. Return to the latest available version by using the controls above in the What Version box.
Text created by the government department responsible for the subject matter of the Act to explain what the Act sets out to achieve and to make the Act accessible to readers who are not legally qualified. Explanatory Notes were introduced in 1999 and accompany all Public Acts except Appropriation, Consolidated Fund, Finance and Consolidation Acts.
Access essential accompanying documents and information for this legislation item from this tab. Dependent on the legislation item being viewed this may include:
This timeline shows the different points in time where a change occurred. The dates will coincide with the earliest date on which the change (e.g an insertion, a repeal or a substitution) that was applied came into force. The first date in the timeline will usually be the earliest date when the provision came into force. In some cases the first date is 01/02/1991 (or for Northern Ireland legislation 01/01/2006). This date is our basedate. No versions before this date are available. For further information see the Editorial Practice Guide and Glossary under Help.
Use this menu to access essential accompanying documents and information for this legislation item. Dependent on the legislation item being viewed this may include:
Click 'View More' or select 'More Resources' tab for additional information including: