Income Tax Act 2007 section 681BD

Relief for rent under new lease

Section 681BD confirms that where a lease has been granted as part of a sale and leaseback arrangement, the person paying rent under the new lease can claim normal income tax relief for that rent, provided they are within the charge to income tax.

• The section applies where rent under a new lease (arising from a sale and leaseback) is payable by a person within the charge to income tax.
• It also applies where the corresponding corporation tax rules are in effect but the rent is still payable by an income tax payer.
• Normal income tax deductions and allowances for rent payments under ITTOIA 2005 apply to rent under the new lease.
• Where the corporation tax provisions apply, references to the new lease and rent take their meaning from the corporation tax legislation.