Finance Act, 1990

Amendment of section 45 (double rent allowance as a deduction in computing trading income) of Finance Act, 1986 .

32.Section 45 (as amended by section 30 ) of the Finance Act, 1986 , is hereby amended by the addition of the following proviso to subsection (2):

“Provided that—

(a) the aggregate of the amount by which the tax liability of an individual is reduced by reason of an allowance under this section and the amount by which his tax liability is reduced by reason of the deduction of the rent giving rise to the allowance shall not exceed the amount of the rent and there shall be made such adjustments in the amount of the relief as is necessary to give effect to this proviso, and

(b) where a person, being a person who holds an interest in a qualifying premises out of which interest a qualifying lease is created (directly or indirectly) in respect of that qualifying premises and in respect of the qualifying lease a claim for a further deduction under this section is made—

(i) takes under a qualifying lease a qualifying premises (hereafter in this proviso referred to as ‘the second-mentioned premises’) which is occupied by him for the purposes of his trade or profession, and

(ii) is, apart from this section, entitled, in the computation of the amount of the profits or gains of that trade or profession, to a deduction on account of rent, in respect of the second-mentioned premises,

then, unless the person shows that the taking on lease of the second-mentioned premises was not undertaken for the sole or main benefit of obtaining for him a further deduction on account of rent under the provisions of this section, he shall not be entitled in the computation of the amount of the profits or gains of his trade or profession to any further deduction on account of rent in respect of the second-mentioned premises.”.