Commentary on Sections Overview Overview Section 243: Rules for determining effective duration of lease
879.This section contains rules for determining the effective duration of a lease. It is based on section 38(1) and (6) of ICTA. The corresponding provisions for income tax are in section 303 of ITTOIA.
880.Subsection (1) sets out various circumstances in which a lease may be treated as ceasing other than on the date specified in the lease. Rules 1, 2 and 3 are based on paragraphs (a), (b) and (c) respectively of section 38(1) of ICTA.
881.Rule 1 provides that the lease is treated as ending on the date beyond which it is unlikely that the lease will continue. See Change 50 in Annex 1.
882.Subsection (3) is new. It ensures that all amounts that may give rise to a charge to tax by reason of sections 218 to 221 are treated as premiums in applying Rule 1 in subsection (1). See Change 50 in Annex 1.
883.Schedule 1 to this Act amends section 303 of ITTOIA (rules for determining effective duration of lease) so that the changes also apply for income tax. See Change 50 in Annex 1.