Under International Accounting Standards IAS 17,a capital lease exists if the lease term is equal to 50% or less of the estimated economic life of the property.

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According to IAS 17, a capital lease exists if any one of the four criteria mentioned in the standard is met, one of which is if the lease term is for a major part of the economic life of the asset, which is defined as 75% or more. Therefore, a lease term equal to 50% or less of the estimated economic life of the property does not fulfill the conditions for a capital lease under IAS 17.

Under International Accounting Standards IAS 17,a Capital Lease Exists If