Part 19Sale and lease-back etc
Chapter 3Leased trading assets
Application of the Chapter
864Leased trading assets
1
Section 865 has effect if—
a
condition A is met, and
b
condition B or C is met.
2
Condition A is that—
a
a payment is made by a company under a lease of a relevant asset, and
b
a deduction is allowed for the payment in calculating the profits of a trade for corporation tax purposes.
3
Condition B is that—
a
at a time before the lease's creation the asset was used for the purposes of the trade, and
b
when it was so used it was owned by the person then carrying on the trade.
4
Condition C is that—
a
at a time before the lease's creation the asset was used for the purposes of another trade, or for the purposes of a profession or vocation,
b
when it was so used it was owned by the person then carrying on the other trade, or the profession or vocation, and
c
when it was so used, or later, that person was carrying on the trade mentioned in subsection (2).
5
The reference in subsection (2)(a) to a lease does not include a lease created on or before 14 April 1964.
6
In this section references to a person carrying on a trade, profession or vocation are to the person carrying on the trade, profession or vocation for the time being.