Income Tax Act 2007 section 681BC

Position where new lease does not include all original property

Section 681BC explains how the taxable consideration is adjusted when a new lease covers only part of the property that was included in the original lease, within the sale and lease-back rules.

• This section applies where a new lease covers only some of the property that was subject to the original lease
• The consideration received by the person (L) must be reduced to reflect only the portion relating to the property now covered by the new lease
• The relevant portion is the amount reasonably attributable to the part of the original property that forms or is included in the new lease
• Only the reduced consideration figure is then used for the purposes of the tax charge under section 681BB