Corporation Tax Act 2009 section 43

Caravan sites where trade carried on

Section 43 allows a company that operates a caravan site as part of a trade to elect to include rental income from caravans or pitches within its trading profits rather than treating them as property business income.

• Where a company carries on material trade activities connected with running a caravan site, it may choose to treat income from letting caravans or pitches as part of its trading profits rather than as property business income.
• Both the receipts and the expenses from such lettings must be moved together — a company cannot cherry-pick which element to include in the trade.
• If the trading activity only exists for part of an accounting period, the election to include lettings income in the trade applies only to the receipts and expenses relating to that part of the period.
• A "caravan site" covers both the land on which a caravan is stationed for human habitation and any adjoining land used in conjunction with it, and "letting" includes a licence to occupy.