Section 269ZYZA — Corporation Tax Act 2010: Other relevant credits

Other relevant credits 269ZYZA 1 For the purposes of section 269ZX a “relevant remeasurement credit” is a credit, or other income, brought into account in respect of a relevant remeasurement excess.

2 There is a “relevant remeasurement excess” where—

a a company (“ C ”) is the tenant under a lease of land (and “L” is the landlord),

b C’s accounts include a relevant right-of-use asset impairment loss in connection with the lease, c under an arrangement (“C’s arrangement”) made at arm’s length, C’s obligations under the lease are varied or cancelled, d as a result of C’s arrangement, C is required, for accounting purposes, to remeasure the lease liability in relation to the lease, e the remeasurement results in the lease liability being reduced by an amount which exceeds the amount of the right-of-use asset recognised in relation to the lease (taking account of any right-of-use asset impairment loss),

and f the relevant requirements are met (see subsection (5) ).

3 For the purposes of section 269ZX a variable lease payment is “relevant” if it is a credit, or other income, brought into account in circumstances described in subsection (4) .

4 Those circumstances are where—

a a company (“ C ”) is the tenant under a lease of land (and “L” is the landlord),

b C’s accounts include a relevant right-of-use asset impairment loss in connection with the lease, c under an arrangement (“C’s arrangement”) made at arm’s length, there is a change in the payments that would have been payable by C under the lease on or before 30 June 2022, d the change would not have been made if it were not for coronavirus, e for accounting purposes, C opts to record the change by means of variable lease payments (rather than by remeasuring its lease liability in relation to the lease),

and f the relevant requirements are met (see subsection (5) ).

5 For the purposes of subsections (2) and (4) , the relevant requirements are met if—

a the requirements in section 269ZY(3)(b) and (c), or b the requirements in section 269ZY(3)(c) and (5)(a), (b), (d) and (e), are met in relation to C, L and C’s arrangement (as defined in subsection (2) or (4) , as appropriate).

6 In determining whether a company is required to account as described in subsection (2)(d) , ignore any option the company has to account as described in subsection (4)(e) .

7 The Treasury may by regulations substitute for the date for the time being specified in subsection (4)(c) such later date as they consider appropriate.

8 In this section— “ coronavirus ” means severe acute respiratory syndrome coronavirus 2; “ lease liability ”, in relation to a company and a lease, means a liability recognised in the company’s accounts to reflect the company’s obligations as tenant under the lease; “ right-of-use asset ”, in relation to a company and a lease, means an asset recognised in the company’s accounts to reflect the company’s right to use land as the tenant under the lease; “ relevant right-of-use impairment loss ” has the meaning given in section 269ZY(2A).