Monthly Charges for Quarterly Leases
A lease paid quarterly, half-yearly or annually can be charged in every month of its term rather than only in the months it pays. Turn on Monthly Charges under Settings, Calculation Methodology, and a quarterly lease stops showing a quarter of cost in one month and nothing in the next two.
What the setting does
Each payment period is spread across the calendar months it covers, by day count. The interest and depreciation for the period are divided between those months; the last month of the period takes any rounding, so the months always add back to the period exactly.
Where to set it
Nothing is re-priced
The lease liability, the discount rate and the balances at every payment date are exactly as they were. Only the dates on which the charges are recognised change. Switching the setting on or off never alters what a lease is worth, which is why it is safe to try.
The rent is still paid when the lease says
Cash never moves month. The payment stays on its contractual date, so the months in between carry interest and depreciation with an empty payment column, and the liability grows by the interest accrued until the next payment clears it.
What it does not do
It spreads periods, it never combines them. A lease that pays weekly or fortnightly keeps a row for each payment, because each one already falls inside a single month; the setting adds a split only where a week straddles a month end. A lease paying monthly on a fixed day that is not the first, for example the 15th, does split: each period covers two calendar months, so its schedule roughly doubles in length and gains a figure at every month end.
Worked example
A lease paying 4,625.00 per quarter in advance on the English Quarter Days, at 5.5% over three years from 29 September 2025:
One quarter, three months
When to switch it on
At the start of a period you have not yet posted. The setting changes which month a charge falls in, so switching it mid-period would restate months you have already reported. Your year-end position is unaffected either way: the totals for a full year are identical.
A year end inside a payment period