IFRS 16 lease calculator

The lease liability, the right-of-use asset, and every period of the schedule. Free, no signup, and nothing you type leaves your browser.

Payment

Per period, excluding VAT

Paid

Term (months)

Discount rate % a year

Rate implicit, or your borrowing rate

Timing

Initial direct costs

Added to the asset, not the liability

Lease liability

present value of the payments

Right-of-use asset

liability plus initial direct costs

Current portion

principal due within 12 months

Total interest

paid over the whole term

#	Month	Opening liability	Interest	Payment	Closing liability	Depreciation	Right-of-use

How this is worked out

Every payment is discounted at its own date, rather than by an annuity formula. That is slower to write and correct for more leases: a quarterly payment, a rent-free first period or a stub at the end all price themselves, where a formula assumes an unbroken series.

The monthly rate is the annual rate divided by twelve.
Each payment is divided by (1 + rate) raised to the number of months from commencement to that payment.
The liability is the sum of those discounted payments.
The right-of-use asset is the liability plus any initial direct costs.
The asset is depreciated straight line over the term.
The liability unwinds: interest at the monthly rate on the opening balance, less the payment, gives the closing balance.
The current portion is the principal repaid over the next twelve months.

These are the same figures Elvira posts. The method above is the one in the product, not a second implementation written for this page: so what you see here is what the books would carry.

Where this comes from

IFRS 16.22: At the start of a lease, recognise a right-of-use asset and a lease liability.
IFRS 16.26: Measure the liability at the present value of the payments not yet made, discounted at the rate implicit in the lease or, failing that, the incremental borrowing rate.
IFRS 16.24: The right-of-use asset includes the liability, initial direct costs, and payments made at or before commencement.
IFRS 16.31: Depreciate the right-of-use asset, applying the depreciation requirements of IAS 16.
IAS 1.69: A liability due within twelve months is current: hence the split above.

Our summary of what each paragraph requires, not the text of the standards, which is the IFRS Foundation’s copyright. This calculator is a tool, not accounting advice : the standards themselves, and your own auditor, are the authority. It also assumes a simple lease: no variable payments, no purchase option, no restoration provision, and no remeasurement.

Elvira does this for every lease you have.

Posted, depreciated monthly, and the current portion reclassified: not typed into a spreadsheet each time.

See how leases work in Elvira