lease assignment premium | AccountingWEB

lease assignment premium

i am considering buying a leasehold pub. the lease is granted by a major brewery to the current vendors and is a 10 renewable lease expiring in June 2018.

the existing lessee is charging a premium of £100,000 for the assignment of the lease. How do I treat the premium in my P&L and balance sheet.

Do I treat like goodwill and show as an intangible asset and write off over the remaining life of the lease ie £00,000 divided by 6 = £16,666 per annum

regards harry barnes