Section 56 Car ... hireF9

United Kingdom

(1)

Subsection (2) applies if, in calculating the profits of a trade, a deduction is allowed for expenses incurred on the hiring of a car F1which is not——

(a)

a car that is first registered before 1 March 2001,

(b)

a car that has low CO ₂ emissions,

(c)

a car that is electrically propelled, or

(d)

a qualifying hire car.

(2)

The amount of the deduction which would otherwise be allowable is reduced by F215%.

(3)

Subsection (4) applies if a deduction is reduced as a result of subsection (2), or a corresponding provision, and subsequently—

(a)

there is a rebate (however described) of the hire charges, or

(b)

a debt in respect of any of the hire charges is released otherwise than as part of a statutory insolvency arrangement.

(4)

The amount that, as a result of the rebate or release—

(a)

is brought into account as a receipt of the trade, or

(b)

is treated as a post-cessation receipt under section 193 (debts released after cessation),

is reduced by F315%.

(5)

In this section “corresponding provision” means—

(a)

section 1251(2) (car F4... hire: expenses of management), F5including as applied by section 82(4) of FA 2012, or

(b)

section 48(2) of ITTOIA 2005 (car F6... hire: trade profits and property income), F7...

(c)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F8(6)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Annotations

Textual amendments

F1: Words in s. 56(1) substituted (with effect in accordance with Sch. 11 paras. 65-67 of the commencing Act) by Finance Act 2009 (c. 10), Sch. 11 para. 47(2)
F2: Word in s. 56(2) substituted (with effect in accordance with Sch. 11 paras. 65-67 of the commencing Act) by Finance Act 2009 (c. 10), Sch. 11 para. 47(3)
F3: Word in s. 56(4) substituted (with effect in accordance with Sch. 11 paras. 65-67 of the commencing Act) by Finance Act 2009 (c. 10), Sch. 11 para. 47(4)
F4: Words in s. 56(5)(a) omitted (with effect in accordance with Sch. 11 paras. 65-67 of the commencing Act) by virtue of Finance Act 2009 (c. 10), Sch. 11 para. 47(5)
F5: Words in s. 56(5)(a) inserted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 143(a)
F6: Words in s. 56(5)(b) omitted (with effect in accordance with Sch. 11 paras. 65-67 of the commencing Act) by virtue of Finance Act 2009 (c. 10), Sch. 11 para. 47(5)
F7: S. 56(5)(c) and the word immediately preceding it omitted (17.7.2012) by virtue of Finance Act 2012 (c. 14), Sch. 16 para. 143(b)
F8: S. 56(6) omitted (with effect in accordance with Sch. 11 paras. 65-67 of the commencing Act) by virtue of Finance Act 2009 (c. 10), Sch. 11 para. 47(6)
F9: Words in s. 56 heading omitted (with effect in accordance with Sch. 11 paras. 65-67 of the commencing Act) ) by virtue of Finance Act 2009 (c. 10), Sch. 11 para. 47(7)

Notes on Part 3

Modifications

C1: Pt. 3 modified (1.1.2010) by Northern Rock plc (Tax Consequences) Regulations 2009 (S.I. 2009/3227), regs. 1, 4(1)