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How should you treat wayleaves?

Julie Butler looks at how to treat wayleaves – are they farm property income, trading income or capital sums?

WayleavesThere are currently a large number of  new electricity and other pipeline arrangements being proposed in the UK. There are also land agents/professionals offering to review current wayleave arrangements that might have never been paid to the landowner for a percentage of the increased receipts.

Wayleave compensation payments (WCPs) are universally known as wayleaves. The payment is generally to an individual or farm business landowner. The power or mobile phone company is ‘renting’ the space above the land. The electricity need not be for great big pylons but can be wooden poles and lines. The wayleave can also be the renting of the space for a pipeline. Wayleaves are defined by s22(5), ITTOIA 2005 as follows: