For a lease to be deemed valid by the CRA for tax purposes, the lease should NOT contain a payment schedule wherein the initial payments are very high and the latter payments are very low.

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The CRA does not invalidate leases based solely on the structure of the payment schedule, whether the initial payments are very high and the latter payments are very low or vice versa. The validity of a lease for tax purposes depends on the genuine intent, terms, and conditions of the lease agreement, ensuring it reflects a true lease and not a financing arrangement or a purchase in disguise.

For a Lease to Be Deemed Valid by the CRA