Part 4 Agricultural buildings allowances
Chapter 6 Supplementary provisions
Giving effect to allowances and charges
391 Trades
An allowance or charge to which a person is entitled or liable under this Part is to be given effect in calculating the profits of that person’s trade, by treating—
a
the allowance as an expense of the trade, and
b
the charge as a receipt of the trade.
392F2UK property and Schedule A businesses
1
This section applies if a person who is entitled or liable to an allowance or charge for a chargeable period was not carrying on a trade in that period.
2
If the person was carrying on F3a UK property business, or a Schedule A business, at any time in that period, the allowance or charge is to be given effect in calculating the profits of that business, by treating—
a
the allowance as an expense of that business, and
b
the charge as a receipt of that business.
F12A
If the person is within the charge to income tax in respect of the allowance or charge and he was not carrying on a UK property business at any time in that period, the allowance or charge is to be given effect by treating him as if he had been carrying on such a business in that period and as if—
a
the allowance were an expense of that business, and
b
the charge were a receipt of that business.
3
If the person F4is a company within the charge to corporation tax in respect of the allowance or charge and it was not carrying on a Schedule A business at any time in that period, the allowance or charge is to be given effect by treating F5the company as if F6it had been carrying on such a business in that period and as if—
a
the allowance were an expense of that business, and
b
the charge were a receipt of that business.
Meaning of “freehold interest”, “lease” etc.
393 Meaning of “freehold interest”, “lease”, etc.
1
In this Part “freehold interest in land” means—
a
the fee simple estate in the land, or
b
in relation to Scotland, the interest of the owner.
2
In this Part “freehold interest in land” also includes—
a
an agreement to acquire the fee simple estate in the land, or
b
in relation to Scotland, an agreement to acquire the interest of the owner.
3
In this Part “lease” includes—
a
an agreement for a lease if the term to be covered by the lease has begun, and
b
any tenancy,
but does not include a mortgage (and “lessee”, “lessor” and “leasehold interest” are to be read accordingly).
4
In the application of this Part to Scotland—
a
“leasehold interest” means the interest of a tenant in property subject to a lease, and
b
any reference to an interest which is reversionary on a leasehold interest or on a lease is to be read as a reference to the interest of the landlord in the property subject to the leasehold interest or lease.