Revenue Precedents

The milk quota is treated as attaching to the land. Income from leasing of the quota would be assessable under the rules of Case V of Schedule D, i.e. on the profits arising in the year of assessment, and not on the profits received. If the agreement provides that the full amount of the payment in respect of the lease will arise (i.e. become payable) in the first year, then it will be taxed in that year. If the agreement provides that the amount will become payable over each of the five years, then it will be taxed accordingly. IT903004

Whether rent paid as an up-front lump sum is taxable in year of receipt? On the basis that the up-front payment represents a single payment of rent, it is taxable in the year in which it is received. A trader making such a payment would be required to spread it in accordance with the matching principle in preparing accounts. IT972009