½Û×ÓÊÓƵ

Premiums on the grant or surrender of a lease

Produced by Tolley in association with of Crane Dale Tax, part of AMS Group
Corporation Tax
Guidance

Premiums on the grant or surrender of a lease

Produced by Tolley in association with of Crane Dale Tax, part of AMS Group
Corporation Tax
Guidance
imgtext

Premiums on the grant of a lease ― outline

When a property investor grants a lease, potentially this could be done on the basis that the tenant pays a premium for the initial grant of the lease, in addition to also paying rent over the term of the lease. In the absence of specific legislation to the contrary, such premiums would all be regarded for tax purposes as a capital receipt of the investor. Instead, there is specific legislation to treat some or all of such premiums as income. There are also other situations in which the legislation treats sums paid in respect of interests in property as income which would otherwise be treated as capital. This guidance gives an overview of the tax treatment of the following:

  1. •

    premiums on 'short' leases (leases with 50 years or less to run)

  2. •

    sums paid for the surrender of leases

  3. •

    mismatches between sale proceeds with price for reconveyance to the vendor, or person

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, and tax research, register for a free trial of Tolley+â„¢
Rob Durrant-Walker
Rob Durrant-Walker

Tax Director at Crane Dale Tax , Corporate Tax, OMB, Personal Tax


Rob is a cross-tax advisor with a particular focus on property tax planning, and business structure planning for OMB’s. He provides tax advice to other accounting firms, balancing commerciality, ethics, and understanding complexity. His 30+ years of experience start at the Inland Revenue in Hull. After completing his ATT and CTA by 1999 with PKF, he subsequently worked at KPMG and UHY prior to managing the business tax team as a director at Garbutt + Elliott. Rob is now Tax Director at the independent tax consultancy, Crane Dale Tax. He is a regular author for Taxation magazine with many articles and Readers Forum contributions since 2005, and he contributes as a virtual member to the CIOT Property Tax technical committee. Rob works remotely from Vancouver in Canada.

Powered by

Popular Articles

Allowable expenses for property businesses

Allowable expenses for property businessesGeneral itemsMany of the principles applying to allowable expenses for property businesses are similar to those that apply for trading and the rules for individuals in a property business are generally the same as for companies with some exceptions which are

14 Jul 2020 13:26 | Produced by Tolley in association with Rob Durrant-Walker of Crane Dale Tax, part of AMS Group Read more Read more

Group relief for carried-forward losses

Group relief for carried-forward lossesThis guidance note examines in detail the relief available to groups for carried-forward losses. The scope excludes the treatment of specialist businesses such as banks, insurance companies and oil and gas companies.From 1 April 2017, companies can surrender

14 Jul 2020 11:50 | Produced by Tolley Read more Read more

Payment of tax due under self assessment

Payment of tax due under self assessmentNormal due dateIndividuals are usually required to pay any outstanding income tax, Class 2 and Class 4 national insurance, and capital gains tax due for the tax year by 31 January following the end of the tax year (ie 31 January 2025 for the 2023/24 tax year).

14 Jul 2020 12:52 | Produced by Tolley Read more Read more