BLM70535 - 바카라 사이트˜Income-into-capital바카라 사이트™ schemes and back loaded leases: Definition of a Chapter 2 of Part 21 of CTA 2010 lease: Condition B: repayment of investment

A further element of the definition of a 바카라 사이트˜major lump sum바카라 사이트™ is that it must contain a part which for accounting purposes is to be regarded in accordance with normal accounting practice as a repayment of some or all of the investment in respect of the finance lease or loan.

CTA10/S935 and the definition of 바카라 사이트˜accounting purposes바카라 사이트™ in CTA10/S937 ensure that it is necessary to have regard to the correct treatment in accordance with GAAP as they apply either:

  • to the lessor, or
  • in the consolidated accounts of a group of which the lessor is a member, or
  • in the accounts of a connected person.

It is possible to deem into existence accounts of any lessor or connected person correctly drawn up in accordance with GAAP if such accounts do not already exist. It is also possible to deem into existence consolidated group accounts in circumstances where it is possible to do so for the purpose of determining whether a lease is a finance lease, as set out in BLM70426.

An 바카라 사이트˜investment in respect of a finance lease바카라 사이트™ is not precisely equivalent to any of the defined terms used in GAAP and you should resist attempts to align it with any of terms used in GAAP. The lessor바카라 사이트™s outlay on the leased asset, in substance the loan principal, reduced to the extent it has been 바카라 사이트˜repaid바카라 사이트™ in the form of lease rentals, will at any time be equal to 바카라 사이트˜some or all of the investment바카라 사이트™.

For this purpose the investment does not include sums added to the lessor바카라 사이트™s outlay which represent:

  • the lessor바카라 사이트™s own funding costs;
  • rolled up 바카라 사이트˜negative depreciation바카라 사이트™ (equivalent to rolled up interest on a loan) and
  • the lessor바카라 사이트™s incidental costs of purchasing the asset and entering into the lease.