Income Tax (Trading and Other Income) Act 2005 section 66

Corporation tax receipts treated as taxed receipts under ICTA

Section 66 ensures that tenants carrying on a trade can claim a deduction for lease premium expenses even where the landlord is a company liable to corporation tax rather than income tax, by treating the landlord's corporation tax receipt as if it were a taxed income tax receipt.

• Where a landlord is a company subject to corporation tax, amounts treated as receipts of the landlord's property business under corporation tax rules are treated as "taxed receipts" for the purposes of the tenant's trade deduction
• This means the tenant obtains the same relief for lease premium expenses regardless of whether the landlord pays income tax or corporation tax on the premium
• The section applies the conditions set out in section 296 (which deals with corporation tax receipts in the context of property businesses) to the trade deduction rules in sections 60 to 67
• Key terms such as "receipt period" and "unreduced amount" are adapted so they work correctly when the underlying receipt is a corporation tax receipt rather than an income tax receipt