Monies received for the extension of leases on properties sold under RTB scheme

We are due to receive monies shortly in relation to the extension of the lease on a leasehold property that was previously sold by the Council under the Right to Buy scheme. I want to check the accounting treatment for this cash receipt. As this property has been sold we are not treating it as profit on disposal. Should this be a capital or revenue receipt? If it is a revenue receipt should it be spread over the lease extension period or can it all be taken to revenue on the date it is received? Any help with this issue is most appreciated. Thank you.
  • Questions I''d consider would be: How much is the receipt? How long is the lease? Have you assessed it as a finance or operating lease? Are you in effect disposing of your interest in the asset via the lease extension?