# Capital Allowances Act 2001, Section 70V: Tax avoidance involving international leasing

Extent: E+W+S+N.I.

(1) This section applies where matters are so arranged that there are plant or machinery leases such that—
(a) under a lease by a non-resident, an asset is provided directly or indirectly to a resident,
(b) the direct provision of the asset to the resident is by a lease which, in the case of the resident, is a long funding lease or a lease to which section 67 (hire purchase etc) applies,
(c) the asset is used by the resident for the purpose of leasing it under a lease (the “relevant lease”) that would not (apart from this section) be a long funding lease in the case of the resident, and
(d) under the relevant lease, the asset is provided directly or indirectly (but by a lease) to a non-resident.
(2) Subsection (3) applies if the sole or main purpose of arranging matters in that way is to obtain a tax advantage by securing that allowances under this Part are available to a resident by virtue of—
(a) section 67 (hire purchase), or
(b) section 70A (long funding leases).
(3) In any such case, the relevant lease is deemed to be a long funding lease in the case of the resident who is the lessor under it.
(4) The reference in this section to a person obtaining a tax advantage (see section 577(4)) also includes a reference to a person obtaining a tax advantage within the meaning of section 1139 of CTA 2010.
(5) In this section—
“non-resident” means a person who—
(a)is not resident in the United Kingdom, and
(b)does not use the plant or machinery exclusively for earning profits chargeable to tax;
“resident” means a person who—
(a)is resident in the United Kingdom, or
(b)uses the plant or machinery exclusively for earning profits chargeable to tax.

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Source: https://www.legislation.gov.uk/ukpga/2001/2/section/70V (the official version)
Page: https://openlegislation.uk/capital-allowances-act-2001/section-70V
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.