BIM46285 - Specific deductions: premiums: office procedure

Before a trading deduction is agreed, the following procedure should be observed:

Where a charge arises under ICTA88/S35 (1) on the assignor of a lease granted at undervalue, the assignee's office should defer the agreement of a trading deduction until the assignor's Schedule A liability has been agreed.

In other cases, the lessee's office should not agree a trading deduction until, following the issue of form 288 (or typed memorandum), form 289 is received showing the chargeable amount of the premium etc as agreed with the lessor.

See PIM2340 as regards the action to be taken where:

• a lessee disputes the amount chargeable on the lessor,
• the lessor is not assessable under Schedule A , for example, because of exemption as a charity.