UK Capitalisation of lease cancellation charge


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Hi there

My company is refurbishing one of its buildings. Currently we lease some laundry equipment, however as part of the refurbishment we are going to terminate the lease (thereby incurring a cancellation fee) and outsource the laundry instead.

My question is - can we capitalise the cancellation charge as part of the refurbishment costs?

Any help would be gratefully received!

Many thanks!
 
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Fidget

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No. It's a cancellation fee, so it's an expense.
 

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