BLM70561 - 鈥業ncome-into-capital鈥� schemes and back loaded leases: Definition of a Chapter 2 of Part 21 of CTA 2010 lease: Condition D: 鈥榓ccountancy rental earnings' must exceed 'normal rent'
The condition in CTA10/S902(7) is aimed at excluding leases where the income from a finance lease shown in the accounts drawn up under GAAP, the 鈥榓ccountancy rental earnings鈥�, is taxed year by year. Since the GAAP income will represent the full amount of the 鈥榠nterest鈥� on the 鈥榣oan鈥� as it accrues there is, in these circumstances, no scope for turning income into capital.