Lease purchase packages provide
the same tax and financial benefits as hire purchase, but payment can be
structured to suit your business's cash flow. You can have a monthly or
quarterly payment schedule.
After an initial deposit, the balance is repaid by equal
monthly payments. The agreement can be from 1 to 4 years and at the end of the
agreement you become the owner. No VAT added to the payments and interest is
tax deductible. The equipment is considered a company asset, which allows it to
be written down against taxable profits.
Leasing can offer you the
most cost effective way to acquire an asset. Financing costs are calculated on
the price of the equipment, exclusive of VAT. This dramatically reduces the
cost of the monthly rentals. Rentals can be paid monthly or quarterly and can
be tailored to your cash flow . Rentals can be
offset against taxable profits if you are VAT registered.
Balanced Payment Plan
The best of both
worlds... you opt for a variable interest rate but with fixed repayments. So
that when rates fluctuate, only the number of repayments varies but the amount
stays the same, thus helping your administration and budgeting.
This is another form of lease
purchase and provides you with even greater flexibility as it incorporates a
variable rate of interest. Realistic interest rates are agreed at the
commencement of the agreement and your monthly payments are then fixed
throughout the period. If interest rates alter, your agreement will lengthen or
to get a quote
Rentals are tailored to suit
your cash flow, and you get a guaranteed residual value with no disposal risk.
As with finance leasing, VAT can be recovered at the same rate. An operating
lease can be classified as "off balance sheet finance", with rentals allowable
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