New Zealand Allows Extended Lease Terms for COVID-19 to Remain Treated as Operating Leases

New Zealand Inland Revenue has published a variation determination dated 14 December 2021, providing relief where lessors and lessees have agreed to extend lease terms (or intend to do so) due to the financial impacts of COVID-19. This includes an extension of the time period in the definition of "finance lease" so that certain extended leases can continue to be treated as operating leases. This is important in relation to the standard rules providing that an operating lease of an asset has …