Section 809ZA — Finance Act 2008: Plant and machinery leases: capital receipts to be treated as income

Plant and machinery leases: capital receipts to be treated as income 809ZA 1 This section applies if—

a there is an unconditional obligation, under a lease of plant or machinery or a relevant arrangement, to make a relevant capital payment (at any time), or b a relevant capital payment is made under such a lease or arrangement otherwise than in pursuance of such an obligation.

2 The lessor is treated for income tax purposes as receiving income attributable to the lease of an amount equal to the amount of the capital payment.

3 The income is treated—

a if subsection (1)(a) applies, as income for the period of account in which there is first an obligation of the kind mentioned there, and b if subsection (1)(b) applies, as income for the period of account in which the payment is made.