HTA 602 Lecture Notes - Lecture 12: Finance Lease, Canada Border Services Agency, Leaseback

• School: Ryerson University
• Department: Hospitality and Tourism Management
• Course: HTA 602
• Professor: Bernard Mc Evoy

Document Summary

Taxes, canada customs and revenue agency (ccra) and leases. Lease - a contractual arrangement where the asset owner(the lessor) grants the user(the lessee) the right to the asset for a specific time in return for specific payments. Specific time period - often with renewal options. Form of 100% financing requiring no capital outlay. Usually a shorter-term lease under which the lessor is responsible for insurance, taxes, and upkeep. A longer-term, fully amortized lease under which the lessee is responsible for maintenance, taxes, and insurance. Company sells an asset it already owns to another party and then lease it back from them. Three parties involved, lessee, lessor and lender. For lessee there is no difference than direct lease. For lessor asset is acquired partly with own funds and partly with borrowed funds. Borrowed funds are secured by mortgage on asset. Lessor owns and can therefore depreciate the asset for tax purposes.