CG70721 - Leases: introduction: annual tenancies

Some leases are granted for 1 year only, but are automatically renewed from year to year unless either the lessor or the lessee takes action to bring the lease to an end. In such cases, the annual leases give rise to a single continuous tenancy and should not be treated as a succession of 1 year leases. Rather, they should be treated as a single continuous lease. This rule is important when considering:

• indexation allowance,
• rebasing,
• wasting of expenditure under TCGA92/SCH8/PARA1, see CG71141 onwards.

This kind of lease is often used to create agricultural tenancies.