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Leasing an Asset

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Leasing an Asset

  • This topic has 3 replies, 2 voices, and was last updated 4 years ago by AvatarJohn Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • October 27, 2021 at 8:31 am #639187
    Avatartabasumze
    Participant
    • Topics: 40
    • Replies: 48
    • ☆☆

    While leasing an asset, the owner of the asset pays tax and not the lessee.
    In that case why is the tax relief cash flow relevant in calculating lease payments?

    October 27, 2021 at 3:22 pm #639238
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54839
    • ☆☆☆☆☆

    The lessee pays tax on their income less their expenses. The lease payments are allowable for tax and therefore result in a tax saving.

    October 27, 2021 at 5:37 pm #639259
    Avatartabasumze
    Participant
    • Topics: 40
    • Replies: 48
    • ☆☆

    Ohh, now I get it..thank you so much.

    October 28, 2021 at 8:00 am #639279
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54839
    • ☆☆☆☆☆

    You are welcome 🙂

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘Leasing an Asset’ is closed to new replies.

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