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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Leases: property income: non-arm's length grant of lease: deemed premium


  • the grant of a short lease is not at arm’s length;
  • no premium is actually paid; and
  • a premium is deemed to have been paid, see CG70825,

none of that deemed premium will be chargeable as income and the whole of the deemed premium will be brought into the computation of the gain arising on the grant of the lease.