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Chapter PIM1115

Document Cited in Related
Vincent
Published date10 April 2016
Record NumberPIM1115
CourtHM Revenue & Customs
CTA09/S45 Electricity & gas wayleave easements

An easement is a right enjoyed by a person over land which they do not own. Landowners may receive payments for easements from electricity and gas concerns, or other similar undertakings, for easements in connection with cables, pylons or similar on or over their land. The types of payment which may be made include:

  • yearly payments for easements,

  • single lump sum payments for grants in perpetuity or for a specified number of years,

  • yearly or lump sum payments for disturbance arising from the erection of pylons, relaying of mains etc.

How they are treated

a) Yearly payments for easements

  • Where a payment can be regarded as a trading receipt it will be assessable as trading income.

  • Where the electricity wayleave payments are received for wires and cables running over or under land which gives rise to property income, the wayleave payments should be treated as a property income receipt.

  • Otherwise the wayleave payments will be assessable under Part 10 CTA09.

b) Single lump sum payments

These are to be regarded as capital receipts and are accordingly not chargeable as trading income, though CGT liability may arise (see CG12955).

c) Payments for disturbance

Payments for disturbance do not fall under (a) above, even if they are payable under away leave agreement. Yearly payments within CTA09/S45 will be subject to CT.

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