s 70V Tax avoidance involving international leasing
(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— is not resident in the United Kingdom, and does not use the plant or machinery exclusively for earning profits chargeable to tax; “ resident ” means a person who— is resident in the United Kingdom, or uses the plant or machinery exclusively for earning profits chargeable to tax.