A trade may be carried on as part of, or ancillary to, a letting
activity if a lessor provides significant services to a lessee. In
order to establish that the provision of services amounts to a
trade, it would need to be shown that such services went well
beyond those normally provided by a lessor to a lessee. In
practice, such cases will be rare. For the approach to be adopted
in considering such cases see PIM4300.
Where, exceptionally, it is accepted that the provision of
services is on trading account the trade profit derived from those
services must be computed. Any reasonable allocation as between
rent proper and charge for services may be accepted. No objection
need be offered to allowing, as an expense, such proportion of
general management expenses as are necessarily incurred in the
course of earning profits from services.
