Part 19Sale and lease-back etc
Chapter 2New lease of land after assignment or surrender
Application of the Chapter
850New lease after assignment or surrender
1
This Chapter has effect if each of conditions A to E is met.
2
Condition A is that—
a
a company (“L”) is a lessee of land under a lease which has 50 years or less to run (“the original lease”), and
b
L is entitled in respect of the rent under the original lease to a deduction by way of relevant corporation tax relief.
3
Condition B is that—
a
L assigns the original lease to another person or surrenders it to L’s landlord, and
b
the consideration for the assignment or surrender would not (apart from this Chapter) be taxable except as capital in L’s hands.
4
Condition C is that—
a
another lease (“the new lease”) is granted, or assigned, to L or a person linked to L, and
b
the new lease is for a term of 15 years or less.
5
Condition D is that the new lease—
a
is of all or part of the land which was the subject of the original lease, or
b
includes all or part of the land which was the subject of the original lease.
6
Condition E is that neither L nor a person linked to L had, before 22 June 1971, a right enforceable at law or in equity to the grant of the new lease.
7
If each of conditions A to D is met but condition E is not met, see the relevant provisions in Schedule 2 to this Act and Schedule 9 to TIOPA 2010.