Finance Leasing Manual - FLM12.33

Rentals wholly written off over short primary period

A point similar to that described at paragraph Error! Reference source not found. may also arise where:

• a lease does provide for secondary periods (as is usually the case), and

• the primary period is significantly shorter than the likely useful life of the asset and

• the accounting treatment, said to be consistent with SSAP 21, is to depreciate fully the leased asset over the primary period or, indeed, on any basis which uncommercially accelerates the rate of relief.