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Valuation of benefits in kind.
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118.—(1) Any expense incurred by a body corporate in the acquisition or production of an asset which remains its own property shall be left out of account for the purposes of section 117.
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(2) Where the making of any such provision as is mentioned in section 117 (1) takes the form of a transfer of the property in any asset of the body corporate, and, since the acquisition or production thereof by the body corporate, the asset has been used or has depreciated, the body corporate shall be deemed to have incurred in the making of that provision expense equal to the value of the asset at the time of the transfer.
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(3) (a) Where a body corporate is assessed or assessable under Schedule A in respect of any premises the whole or any part of which is made available by it as living or other accommodation for any of its directors or employees, and either the body corporate pays no rent in respect of the premises or the annual amount of the rent paid by it is less than the amount of the assessment under Schedule A on the premises, section 117 shall have effect as if the body corporate paid in respect of the premises an annual rent equal to the amount of the assessment under Schedule A on the premises.
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(b) In this subsection “the amount of the assessment under Schedule A” means an amount which would have been the amount of the assessment thereunder for the year of assessment in question if—
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(i) in section 10 (2) the words “except in the cases mentioned in the subsequent provisions of this section” and “five-fourths of” were omitted, and,
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(ii) section 10 (3) (4) (5) (6) had not been enacted.
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(4) Where an asset which continues to belong to the body corporate is used wholly or partly in the making of any such provision as is mentioned in section 117 (1) and the asset is not premises, the body corporate shall be deemed for the purposes of that section to incur (in addition to any other expense incurred by it in connection with the asset, not being expense to which subsection (1) of this section applies) annual expense in connection therewith of an amount equal to the annual value of the use of the asset, but where any sum by way of rent or hire is payable by the body corporate in respect of the asset—
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(a) if the annual amount of the rent or hire is equal to or greater than the annual value of the use of the asset, this subsection shall not apply, and
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(b) if the annual amount of the rent or hire is less than the annual value of the use of the asset, the rent or hire shall be left out of account for the purposes of that section.
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(5) Any reference in this section to a body corporate which is assessable under Schedule A in respect of any premises shall be deemed to include a reference to a body corporate which would be so assessable if a state of affairs which subsists during any part of the year had subsisted for the whole of the year.
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