The lease must not be a lease of background plant or
machinery leased with land where the plant or machinery has a low
value when compared with the value of the land leased with it.
Where a lessor leases plant or machinery but does not lease
it with land then condition H will not prevent the lease being an
eligible lease even if the plant or machinery is of the type that
would be background plant or machinery if leased with land.
Background plant or machinery
Leases of background plant or machinery are defined by
CAA01/S70R. In broad terms background plant or machinery includes
such equipment as lifts and central heating when they are leased
with a building. Such leases are excluded from the scope of the
long funding lease rules
BLM21305 onwards. Condition H ensures
that such leases are not brought back within the scope of the long
funding lease rules where a lessor has made an election.
Plant or machinery with a low value compared with
land
Leases of plant or machinery that has a low value compared to
the value of the land and buildings with which it is leased are
excluded from the scope of the long funding lease rules
BLM21600. Condition H ensures that such
leases are not brought back within the scope of the long funding
lease rules where a lessor has made an election.
