Beta This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

Business Leasing Manual

Sale of lessor companies and similar arrangements: partnerships: meaning of business of leasing plant or machinery

Section 410 CTA2010

For a partnership to fall within the scope of the sale of lessor company provisions it must carry on a business of leasing plant or machinery. Its business must fulfil condition A or condition B.

Condition A: At least half of the partnership’s plant or machinery must be subject to a lease, or leased out plant or machinery if the relevant day falls on or after 23 March 2011. See BLM80115.

Condition B: At least half of the partnership’s income in a specified period must be derived from leasing, see BLM80160.

The conditions are tested on the relevant day. The relevant day is the day on which the partnership shares change.

The balance sheet value of plant or machinery held by the partnership is adjusted in certain circumstances. Changes to the legislation since 2006 mean that these adjustments will vary depending on the date on which the relevant day falls.

The adjustments are made on the same basis as for companies carrying on a business alone. See:

  • BLM80110 - meaning of carrying on a business of leasing plant or machinery;
  • BLM80112 - The accounting value of plant or machinery - transactions before 23 March 2011;
  • BLM80120- The accounting value of plant or machinery - transactions on or after 23 March 2011;
  • BLM80123 - The accounting value of plant or machinery - transactions before 13 November 2008;
  • BLM80153 Meaning of ‘leased out plant or machinery’ - transactions on or after 23 March 2011