Section 61 | Tenants occupying land for purposes of trade treated as incurring expenses

(1)The tenant under the taxed lease is treated as incurring an expense of a revenue nature in respect of the land subject to the taxed lease for each qualifying day.

(2)If there is more than one taxed receipt, this section applies separately in relation to each of them.

(3)A day is a “qualifying day”, in relation to a taxed receipt, if it is a day—

(a)that falls within the receipt period of the taxed receipt, and

(b)on which the tenant occupies the whole or part of the land subject to the taxed lease for the purposes of carrying on a trade.

(4)If on the qualifying day the tenant occupies the whole of the land subject to the taxed lease for the purposes of the trade, the amount of the expense for the qualifying day by reference to the taxed receipt is given by the formula—

(5)If on the qualifying day the tenant occupies part of the land subject to the taxed lease for the purposes of the trade, the amount of the expense for the qualifying day by reference to the taxed receipt is given by the formula—

(5A)No expense is to be determined under this section by reference to the taxed receipt if section 292(4B) or (4C) applies.^F1

(6)This section is subject to section 62 (limit on deductions if tenant entitled to mineral extraction allowance).