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Hello,
– On 1 Apr 18,Online Ltd acquired a leasehold office building, paying a premium of pounds 90,000 for the grant of of a 10 year lease. The office was used for business purposes.
1. Online year ends is on the 31 March 2019.
2.The calculation for lease deduction is as follows:
– 90000-(90000 x 2% x(10-1)=73800
-73800/10=7380.3. Could you explain the reason behind the calculation?
-From what you’ve explained in your lectures I have understood that calculation for 73,800; however I struggling with that of the 7380.Thanks in advance.
7380 is the premium paid by the trader and that is the amount deductible
it is calculated by property income / no of years
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