Section 136 | Lease premiums etc: reduction of receipts

(1)This section applies for the purpose of calculating the profits of a trade of dealing in land if a receipt of the trade falls within one of the following categories—

(a)lease premiums within section 217,

(b)sums within section 219 (sums payable instead of rent),

(c)sums within section 220 (sums payable for surrender of a lease),

(d)sums within section 221 (sums payable for variation or waiver of terms of lease),

(e)consideration for the assignment of a lease within section 222 (lease granted at an undervalue), and

(f)amounts received on the sale of an estate or interest in land within section 224 (sales with right to reconveyance) or section 225 (sale and leaseback transactions).

(2)The receipt is reduced by the relevant amount.

(3)The relevant amount is the amount which is treated as a receipt of a property business as a result of any of sections 217 to 225.

(4)But if—

(a)the company carrying on the trade makes a claim under section 238 or 239, and

(b)as a result of the claim a repayment of tax is made to that company,

the relevant amount is the amount which, for the purpose of determining the amount of the repayment of tax, is treated as brought into account as a receipt in calculating the profits of the property business.

(5)If subsection (4) applies, any adjustment of liability to tax may be made—

(a)by assessment or otherwise, and

(b)at any time at which it could be made if it related only to tax for the accounting period in which the claim under section 238 or 239 is made.