BLM32805 - Taxation of leases that are not long funding leases: finance lessees: pre-use rentals: introduction

In some 바카라 사이트˜big ticket바카라 사이트™ arrangements rental amounts are paid by the lessee:

  • prior to the primary period (the 바카라 사이트˜pre-primary바카라 사이트™ period); or
  • in the primary period but while the asset is still in the course of construction or manufacture.

These payments reflect the fact that the lessor will already have financed expenditure on the asset.

Under FRS102 and IFRS and FRS101, leases are not accounted for as such until commencement (BLM25050). Instead, they are recorded as a financial asset. However the nature of the finance charge remains the same.

Payments in the pre-primary period will usually consist of only a finance charge (effectively equivalent to an 바카라 사이트˜interest only바카라 사이트™ loan). Payments made in the primary period may involve a further element being the balance of the full rent due under the lease: that is, the lessee will also be repaying some of the 바카라 사이트˜loan바카라 사이트™ as well.