Deductions due to the assignment of a lease agreement in costs

Deductions due to the assignment of a lease agreement

Deductions due to the assignment of the lease agreement are the amount paid to the existing lessee by the company taking over the leased object. This allows the lessee to recover some of the funds invested in the leased asset. In a situation where a significant part of the value of the leased object has already been repaid by the current user, and the lease installments and the redemption value remaining to be repaid by the new user are much lower than the current market value of the leased object, usually the new user (assignee) pays the existing user (assignor) redemption. The amount of the compensation fee is therefore equal to the market value. Of course, for this reason, the seller of the leased object should issue a VAT invoice.

Compensation fees due to the assignment of a lease agreement as a tax expense

The fees due to the assignment of the leasing contract may be classified by the company as tax costs according to general principles. The definition of tax deductible cost shows that it should be a cost aimed at obtaining income, securing or maintaining a source of income (Article 22 (1) of the PIT Act). At the same time, however, these expenses cannot be listed in Art. 23 sec. 1 of the PIT Act as not constituting tax costs. This means that the company taking over the leased object that will be used for the purposes of its business activity will be able to include the compensation fee in tax deductible costs.

The above is also confirmed by the Director of the Tax Chamber in Bydgoszcz in an individual interpretation (ITPB3 / 423-186 / 08 / DK):

(...) the amount of the compensation fee for taking over the leasing contract may be classified as tax deductible costs, provided that the acquired passenger car will be used for business purposes and the incurred expenditure is properly documented (...).

Thus, the fee for the assignment of the lease agreement will be a tax cost for the new user, if it remains in a causal relationship with the revenues generated.