Corporation Tax Act 2010 section 410

Business of leasing plant or machinery

Section 410 defines when a partnership is regarded as carrying on a "business of leasing plant or machinery" on a given day, by reference to two alternative tests based on asset values and income.

• A partnership is treated as carrying on a leasing business if it meets either Condition A (at least half the value of its relevant plant or machinery relates to qualifying leased assets) or Condition B (at least half of its income over the preceding 12 months comes from such assets).
• Qualifying plant or machinery is equipment that the partnership or a qualifying associate has leased out at any point in the past 12 months under a plant or machinery lease, excluding leases of background plant or machinery for a building.
• A qualifying associate is any partner in the partnership, or a person connected with a partner, who held that status at the start of the relevant day or at any earlier time in the preceding 12 months — and where plant or machinery only qualifies because an associate leased it out, the lessee must not be the partnership itself.
• For corporate partners owned by a consortium or that are qualifying 75% subsidiaries of a consortium-owned company, the definition of connected persons is extended to include any consortium member and anyone connected with such a member.

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