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HMRC internal manual

Business Leasing Manual

’Income-into-capital’ schemes and back loaded leases: 'Income-into-capital' schemes: Purchase options: options for borrower to get asset back

In an income-into-capital scheme an option is granted by the Bank to the Borrower. It may be granted by:

  • the Bank’s subsidiary which leases the asset to the Borrower group; or
  • a company connected with that lessor company; or
  • conceivably an unconnected third party who is used as a conduit; for example, an unconnected third party who has an option to acquire the asset from the Bank group while the Borrower group has another option to acquire the asset (or a similar asset) from the third party.