HMRC has published draft anti-avoidance chapters of the Business Leasing Manual to reflect changes to the leasing legislation. The closing date for comments is 31 December 2012.

The guidance provides an overview of the types of tax avoidance occurring in plant and machinery leasing and legislation designed to combat such transactions.

The guidance is split between traditional lease tax avoidance and tax avoidance of long funding leases, which were introduced on 1 April 2006.

There is a separate section on tax avoidance surrounding the interaction of these rules, in particular where there are lease chains or lease and leasebacks involving both types of lease treatment, and also specific guidance on sales of lease rental streams.

HMRC is looking for feedback on the usability of the draft guidance from any customers that use the existing manual or would want to use the new guidance in the future to make sure that it is fit for purpose.

The draft guidance is available from HMRC