BTC Help - lease payments

lisaloo Registered Posts: 13 New contributor 🐸
In the June 2009 paper section 2 there is a calculation for leases payments when adjusting the profit - this is something I don't seem to rememver covering and can't find in the book, can anyone help me out?


  • mini_schnauzer
    mini_schnauzer Registered Posts: 347 Dedicated contributor 🦉
    If the lease car is over £12,000 it is class as an expensive car.
    Therefore you have to add back the disallowed portion of the lease payment.
    Calculation as follows:

    1/2 x (car cost - £12,000) divided by cost of car then multiply by annual lease payments

    The result is the amount to add back.

    Good luck, I'm doing BTC tomorrow as well!
  • talinka
    talinka Registered Posts: 45 Regular contributor ⭐
    I agree with the above reply , however if it's an operating lease - the expedinture is classed as revenue and therefore is not allowable.
  • lisaloo
    lisaloo Registered Posts: 13 New contributor 🐸
    Thanks, all makes sense now! Good luck for tomorrow!
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