The election does not apply to leases where any asset leased
under the lease has a market value of more than £10m at the
commencement of the lease. For this test it is the value of all
assets that is relevant, not just the value of plant or machinery.
Therefore a lessor that has made a long funding lease
election may lease a ship with a value of £10m but that
particular lease would not be an eligible lease.
If the same lessor leased, under a single lease, 1000 pieces
of equipment each with a market value of £20,000, then the
lease would be an eligible lease if all the other conditions were
met.
If a lessor leased a factory including buildings valued at
£15m and plant or machinery valued at £5m the lease would
not be an eligible lease.
