Part 9Leasing plant or machinery
Chapter 3Sales of lessors: leasing business carried on by a company alone
“Business of leasing plant or machinery”
387“Business of leasing plant or machinery”
1
This section determines for the purposes of this Chapter whether, on any day (“the relevant day”), a company (“the relevant company”) carries on a business of leasing plant or machinery.
2
A business carried on by the relevant company is a business of leasing plant or machinery on the relevant day if condition A or B is met.
3
Condition A is that at least half of the relevant plant or machinery value relates to F2plant or machinery falling within subsection (7).
4
Subsection (3) is supplemented by section 388.
F35
Condition B is that at least half of the relevant company's income in the past 12 months derives from plant or machinery falling within subsection (7).
6
Subsection (5) is supplemented by section 391.
F17
Plant or machinery falls within this subsection if—
a
it is or at any time in the past 12 months has been leased out by the relevant company or a qualifying associate,
b
the lease under which it is or has been leased out is a plant or machinery lease but not an excluded lease of background plant or machinery for a building (see section 437(3)), and
c
if the plant or machinery satisfies paragraph (a) only because it is or has been leased out by a qualifying associate, the lessee under the lease is or was someone other than the relevant company.
8
For the purposes of subsection (7)—
a
plant or machinery is “leased out” by a person if it is subject to a plant or machinery lease under which that person is a lessor,
b
“ associate ” means a person connected with the relevant company (see also subsection (9)), and
c
a person is a “qualifying associate” if the person is an associate at the start of the relevant day or at any earlier time in the past 12 months (whether or not a time when the plant or machinery was leased out by the person).
9
If the relevant company is owned by a consortium or is a qualifying 75% subsidiary of a company owned by a consortium, the reference in subsection (8)(b) to a person connected with the relevant company also includes—
a
any member of the consortium, and
b
any person connected with such a member.
10
A reference in this section to the past 12 months is to the period of 12 months ending with the relevant day.