BIM46251 - Specific deductions: premiums: introduction

ICTA88/S87

The following instructions deal with the deduction allowable under ICTA88/S87 where:

• a premium chargeable on the recipient under ICTA88/S34 or ICTA88/S35 (see PIM1200 onwards),
• has been paid by a trader etc or his predecessor in title,
• in respect of premises occupied or used for the purpose of his trade, profession or vocation.

Cases within ICTA88/S36 are excluded from relief under ICTA88/S87.

For the purpose of such a deduction (referred to in this guidance as a trading deduction), relief is due on:

• so much of the premium as is chargeable on the recipient, or
• would be so chargeable but for any relief, exemption or claim by the landlord under ICTA88/S34 (8).

For an explanation of how relief under ICTA88/S87 is to be given see BIM46255.

In general, the same conditions apply as in the case of the relief allowable to an intermediate landlord under Schedule A (see PIM2300 onwards).

As regards artificial leasing transactions, see BIM46260, BIM61300 onwards and PIM1206 onwards.