Income Tax Act 2007 section 77

First-year allowances: partnerships with companies

Section 77 sets out the first circumstance in which sideways relief may be denied for part of a loss, specifically where first-year allowances relate to plant or machinery acquired for leasing by a partnership that includes a company.

• This section applies where a first-year allowance arises from expenditure on plant or machinery provided for leasing within a qualifying activity carried on in partnership with a company.
• It also applies where arrangements have been made with a view to the qualifying activity being carried on in partnership with a company, regardless of when those arrangements were made.
• The presence of other partners in the firm, beyond the individual and the company, does not affect the application of this section.
• Letting a ship on charter is treated as leasing the ship, and references to making arrangements include effecting schemes.