Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

Business Leasing Manual

HM Revenue & Customs
, see all updates

Lease accounting: finance lease accounting: finance lessors: net cash investment

A finance lessor’s net cash investment in a lease at a point in time is defined in paragraph 23 of SSAP 21 as the amount of funds invested in a lease by a lessor, and comprises the cost of the asset plus or minus the following related payments or receipts:

  1. government or other grants receivable towards the purchase or use of the asset;
  2. rentals received;
  3. taxation payments and receipts, including the effect of capital allowances;
  4. residual values, if any, at the end of the lease term;
  5. interest payments (where applicable);
  6. interest received on cash surplus;
  7. profit taken out of the lease.