Interest Rate Implicit in the Lease Calculator
Calculate the implicit interest rate for your lease agreements with our IFRS 16 compliant calculator.
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What is the Implicit Interest Rate?
The interest rate implicit in the lease is the rate that causes the present value of lease payments and unguaranteed residual value to equal the fair value of the underlying asset plus initial direct costs.
IFRS 16 Compliance
Under IFRS 16, lessees must use the implicit rate when it's readily determinable. If not, the lessee's incremental borrowing rate should be used for lease liability calculations.
Tip
Please refer to our blog post on calculating the interest rate implicit in the lease for more information:
Interest Rate Implicit In The Lease Explained - IFRS 16 & ASC 842