John Ellis
Ceist:139 Mr. Ellis asked the Minister for Education the reason leasing payments are not allowed against income calculations for persons who apply for third-level grants. [12323/96]
Written Answers. - Higher Education Grants.
Capital additions-related expenditure is not allowed as a deduction in arriving at reckonable income for grant purposes. Such expenditure is generally shown in the accounts as "depreciation" and "interest on borrowing used to acquire capital items".
Finance lease arrangements are an alternative method of funding the acquisition of fixed assets. The lease payments are comprised of two elements (a) repayment of the "purchase outright" cost of the asset and (b) finance charges levied by the lease company. As those two elements are directly related to capital additions, the expenditure is not deductible for higher education grants purposes.
However, expenditure relating to operating leases is deductible in calculating reckonable income for higher education grants.