To understand what redemption payments are, one should turn to the concept of "leasing" and some aspects of its provision. Leasing is a special type of lending for the purchase of fixed assets. When registering a lease, the user of the service receives one or another property (subject of lease) for temporary possession for a fee in the form of special lease payments. The use of leasing gives entrepreneurs significant tax advantages, as well as the right to redeem the leased asset at the end of the lease agreement.
In other words, leasing is a long-term lease of property for use in the interests of your business, the main feature of such a lease is the ability to provide the leasing recipient with the right to further redeem this property and provide tax incentives. redemption payments. In the lease agreement, provided that it implies the further possibility of redemption of the leased asset, the so-called redemption value of the property is indicated. Accordingly, when making payments under such an agreement, the entrepreneur will pay lease payments - those provided for in the agreement as payment for the use of the property, and redemption payments - those that will be taken into account in the payment of the redemption value of the property upon the expiration of the contract. redemption payments are payments under the lease agreement, which are not aimed at paying for the right to own the leased asset, but at paying off the redemption value of the leased asset for subsequent receipt of it in permanent ownership. payments, the property becomes the property of the recipient of the lease, while the amount of the redemption value is absent in the contract. In such cases, all lease payments made for the period of fulfillment of obligations under the agreement will be regarded as redemption payments, appropriately taxed and accounted for. Redemption payments provide the leasing user with the opportunity to pay step-by-step to register the ownership of the leased asset as an alternative to paying the full redemption value at the end of the lease agreement.
