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Definition: Rents (of land and underground deposits)

National accounts

Rents correspond to payments made to the owner of non-produced tangible assets (land and underground deposits) in return for making assets available to another unit. In the EAA, this item corresponds mainly to rents paid on land by holders to the landowners ( ).
Where the owner pays certain charges directly linked to agricultural activity (property tax, the cost of maintaining land, etc.), the rents to be recorded should be reduced accordingly. These charges are accounted for as other taxes on production (in the case of property tax) or intermediate consumption (in the case of land maintenance).
Rents on land do not include the rentals of buildings or dwellings situated on it; those rentals are treated as the payment for a market service provided by the owner to the tenant of the building or dwelling, and are to be recorded in the accounts as the intermediate consumption of services or as final consumption expenditure (household accounts), depending on the type of tenant unit. If there is no objective basis on which to split the payment between rent on land and rental on the buildings situated on it, the whole amount is to be recorded as rent on land. This rule is an adapted version of the ESA recommendation (cf. ESA 95, 4.73.).
All rent for land should be recorded under this heading whether the land is rented for less or more than one year.
Thus, rents do not include:
· the rental value of dwellings contained in these buildings; this is remuneration for a market service which is a component of private consumption (i.e. the occupant pays the rent from his net residual income);
· rents paid for the professional use of non-residential buildings (cf. 2.48. (a)).
· depreciation of buildings;
· current maintenance expenditure on buildings (cf. 2.46.);
· property tax (cf. 3.21.2. (a));
· expenses relating to buildings insurance (cf. 2.48. (g)).
In the case of land and buildings used by the owner, there is no need to account for notional rents. The rents corresponding to non-produced intangible assets such as patented assets and production rights (milk quotas), should be recorded as intermediate consumption (cf. 2.48. <a href="">http://ec.europa.eu/eurostat/ramon/statmanuals/files/KS-27-00-782-__-I-EN.pdf</a>
Source:
Eurostat, "Manual on the economic accounts for agriculture and forestry EAA/EA 97 (Rev. 1.1)", Luxembourg, 2000
Created:
Updated: