Corporation Tax Act 2009 section 229

The additional calculation rule: special cases

Section 229 modifies the additional calculation rule in section 228 for situations where a lease covers only part of the relevant premises, and sets two caps on the amount of relief available.

• Where a lease premium receipt arises in respect of only part of the premises covered by the original taxed lease, the basic relieving amount is reduced proportionately by a fraction representing the part actually leased, calculated on a just and reasonable basis
• This proportionate reduction applies to receipts under sections 217 to 221 (lease premiums, sums payable instead of rent, sums for surrender, and sums for variation or waiver of lease terms) but not to assignments of leases under section 222, since an assignment always relates to the whole premises
• The basic relieving amount, whether calculated under section 228 or adjusted for a partial lease, is capped at the unused amount of the taxed receipt — it cannot exceed the portion of the original taxed receipt that has not already been used for relief
• The total reduction under section 228 is also capped so that it cannot exceed the amount produced by the relevant taxable premium formula in sections 217, 219, 220, 221 or 222 for the receipt being calculated