Section 76D Computation of income from finance leases
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Amendments
Section 76D inserted by Finance Act 2006 section 61(1)(b) as respects any period of account beginning on or after 1 January 2005.
(1) In this section "finance lease" means a lease which, under generally accepted accounting practice, falls to be treated as a finance lease.
(2) Notwithstanding section 76A and subject to section 80A, for the purposes of computing income of a company from a trade of leasing, income of a lessor from a finance lease-
(a) shall not be the amount of income from the lease computed in accordance with generally accepted accounting practice, and
(b) shall be computed, subject to the provisions of the Corporation Tax Acts other than section 76A, by treating-
(i) lease payments receivable in respect of the lease as trading receipts of the trade, and
(ii) as trading expenses of the trade any disbursements or expenses laid out or expended for the purposes of earning those lease payments.
How do I calculate income under a finance lease for tax purposes?
(2) If your company carries on a leasing trade, its income from a finance lease is not the income as computed under GAAP. Instead, the income is to be computed by treating lease payments receivable as trading receipts, and by treating expenses incurr...
