BLM70405 - 鈥業ncome-into-capital鈥� schemes and back loaded leases: Definition of a Chapter 2 of Part 21 of CTA 2010 lease: computational effects
A Chapter 2 of Part 21 of CTA 2010 lease is subject to two principal computational effects under Part 21. 皇冠体育appse are summarised briefly below but are described in more detail in BLM70801 (accountancy measure of rentals) and BLM73001 (capital allowances).
皇冠体育app first computational effect is that, in common with leases to which Chapter 3 of Part 21 apply, the accountancy rental earnings from the lease (the 鈥榠nterest鈥� on the 鈥榣oan鈥� described as 鈥榞ross earnings鈥� from the lease under SSAP 21, and described as 鈥榝inance income鈥� in FRS101, FRs102 and in IFRS) are recognised for tax for any period of account in which they exceed the rent taxable apart from Part 21. This is subject to provisions intended to ensure that ultimately the same sums are not brought into account for tax more than once.
皇冠体育app second computational effect is that it is not possible to side-step capital allowances balancing adjustments on exit from a Chapter 2 lease by arrangements to dispose of the leased asset indirectly. 皇冠体育appse rules do not apply to leases within Chapter 3.