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HMRC internal manual

Business Leasing Manual

HM Revenue & Customs
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’Income-into-capital’ schemes and back loaded leases: Bad debts: reducing cumulative accountancy rental excess - where there will be a practical effect

The cases where a CTA10/S911 restriction will have a practical effect are limited to those where:

  • subsequent to the bad debt write off, the payment of rentals under the lease is resumed; or
  • the lessor’s outlay on the leased asset does not wholly qualify for capital allowances and capital losses can be recognised on its sale.