Taxes Consolidation Act 1997 section 96

Interpretation (Chapter 8)

Section 96 defines key terms used in the rental income rules and sets out provisions for determining the duration of a lease.

• Defines "lease", "rent", "premium", "premises", "easement" and "the person chargeable" for the purposes of taxing rental income under Case V of Schedule D.
• A residential premises is a building or part of a building used or suitable for use as a dwelling, including any garden, yard or outbuildings; it becomes a rented residential premises where any person is entitled to rent or receipts from easements in respect of it.
• The duration of a lease may be adjusted where break clauses, forfeiture conditions or extension rights make it unlikely that the lease will run its full stated term, and the premium must be consistent with the adjusted duration.
• Where a mortgagee or receiver is in possession of leased premises, the mortgagee is treated as the lessor for tax purposes, but tax is computed as if the original borrower were still in possession.