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This manual is being updated to reflect FRS 102 (2024 amendments). For guidance on the tax treatment of accounts prepared under IFRS 16 or the revised FRS 102, please refer to pages within the BLM50000 chapter.

This page will be archived on 30 November 2025

Where

• a lease is finalised on or after 1 April 2006, or
• the term of a lease commences on or after 1 April 2006

the lease will be a long funding lease unless it is what is known as an excepted lease (and assuming, of course, that it meets the requirements of CAA01/S70G).

Broadly speaking an excepted lease is a lease that was planned and agreed to in principle (but not finalised) by 21 July 2005 and which was finalised and had commenced by 1 April 2007 in roughly the form envisaged on 21 July 2005. In some cases the time limit is extended to 1 April 2009. Further guidance is at BLM23030.

Where the term of a lease of plant or machinery began before 1 April 2006 and that plant or machinery is brought into use for a qualifying activity on or after 1 April 2006 see BLM23020. This will most often happen where a lessor or lessee moves to the UK, but could happen in other circumstances.