Finance (No. 2) Act 2008

Amendment of section 7A (option to tax lettings of immovable goods) of Principal Act.

69.— Section 7A of the Principal Act is amended—

(a) in subsection (1)(d)(iv)—

(i) by inserting “the landlord or” after “when”, and

(ii) by substituting “occupies” for “commences to occupy”,


(b) in subsection (2)—

(i) in paragraph (a) by substituting the following for subparagraph (ii):

“(ii) where the landlord, whether or not connected to the tenant, or a person connected to the landlord, occupies the immovable goods that is subject to that letting whether that landlord or that person occupies those goods by way of letting or otherwise.”,


(ii) to insert the following after paragraph (b):

“(c) Paragraph (a)(ii) and subsection (1)(d)(iv) shall not apply where the occupant (being any person including the landlord referred to in that paragraph or that subsection) uses the immovable goods which are the subject of the letting for the purpose of making supplies which entitle that occupant to deduct, in accordance with section 12, at least 90 per cent of all tax chargeable in respect of goods or services used by that occupant for the purpose of making those supplies. However, where a landlord has exercised a landlord’s option to tax in respect of a letting to which paragraph (a)(ii) would have applied but for this paragraph, paragraph (a)(ii) shall apply from the end of the first accounting year in which the immovable goods are used for the purpose of making supplies which entitle that occupant to deduct less than 90 per cent of the said tax chargeable.”.