SCHEDULES
SCHEDULE 6Leasing businesses
Businesses carried on by companies alone
1
Chapter 3 of Part 9 of CTA 2010 (sale of lessors: leasing business carried on by a company alone) is amended as follows.
2
1
Section 387 (“business of leasing plant or machinery”) is amended as follows.
2
In subsection (3), for “qualifying leased plant or machinery” substitute “
plant or machinery falling within subsection (7)
”
.
3
For subsection (5) substitute—
5
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).
4
For subsections (7) and (8) substitute—
7
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.
3
In section 389 (provision supplementing section 388), in subsection (5)(b), for “market value” substitute “
ascribed value
”
.
4
In section 390 (relevant plant or machinery value where relevant company lessee under long funding lease etc), in subsection (2), for “market value” substitute “
ascribed value
”
.
5
In section 391 (relevant company's income for condition B in section 387), in subsection (5), for “qualifying leased plant or machinery” substitute “
plant or machinery falling within section 387(7)
”
.
6
1
Section 398G (transfers into and out of A) is amended as follows.
2
Omit subsection (2).
3
For subsection (3) substitute—
3
If any event occurs that requires A to bring the disposal value of plant or machinery into account under Part 2 of CAA 2001, that Part has effect as if the disposal value that A is required to bring into account were the higher of—
a
the disposal value determined in accordance with that Part, and
b
the ascribed value of the plant or machinery.
4
Section 265 of CAA 2001 (successions) is subject to this section.
7
In section 401 (provisions supplementing section 400), in subsection (5)(b), for “market value” substitute “
ascribed value
”
.
8
In section 402 (“PM” where relevant company lessee under long funding lease etc), in subsection (2), for “market value” substitute “
ascribed value
”
.
9
1
Section 403 (“TWDV” in section 399) is amended as follows.
2
In subsection (2), for paragraph (b) substitute—
b
in calculating the amounts of unrelieved qualifying expenditure mentioned in subsection (1)(a) to (c), any part of those amounts that is relevant new expenditure is to be left out of account.
3
After that subsection insert—
3
Relevant new expenditure” means—
a
expenditure attributable to plant or machinery acquired by the relevant company on the relevant day except for plant or machinery acquired on that day from an associated company, and
b
expenditure incurred on the relevant day but attributable to plant or machinery acquired by the relevant company before that day.
4
In subsection (3)—
a
“acquired” includes brought into use or made available for use for the first time for the purposes of the business, and
b
a reference to anything acquired or incurred includes anything treated as acquired or treated as incurred.