depreciation under operating lease

[NIKITA PATIL]

who can claim depreciation in operating lease?if after 3 years lessor will sell asset to lessee...

[Mahir S]

In case of operating leases, for accounting purpose, the leased asset is shown as a Fixed Asset in the books of Lessor and depreciation is claimed by the Lessor.

In your case, for the first three years and before the sale of asset, depreciation is to be claimed by the Lessor.

AI Summary

Depreciation in operating lease: lessor retains depreciation claim until sale of the asset to the lessee. In an operating lease the lessor is entitled to claim depreciation on the leased asset because the asset is recorded as a fixed asset in the lessor's books; the lessor continues to claim depreciation up to the point of transfer or sale to the lessee.