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this is why you should Lease

Asset finance is a very flexible way of raising funds:

• Assets and capital equipment can be paid for from the revenue they earn
• Rates can be as competitive, or even better, than bank funding rates because of the security provided by the asset
• Longer-term options than many bank loans, typically 3 to 5 years
• Fixed rates are available, making budgeting easier
• It is generally non-cancellable by the lender, providing certainty to businesses
• Asset finance offers real value to businesses with limited capital, or those that need to manage their cash flow.
• It is highly accessible, as it is secured - largely or entirely - on the asset being financed.
• It can be very cost effective, as the provider can often buy assets lower, and sell higher, than an individual business. Companies can choose to leave the acquisition and disposal of equipment to the experts
• In a recession, leasing is particularly well positioned to help businesses when most have low taxable profits
• Depending on the situation, companies may benefit from tax advantages

CASH V LEASE explained

Cost of goods £10,000

3 Year lease @ £963.20 per quarter (1+11)

Total payable = £963.20 X 12 = £11,558.40

You pay £1,558.40 over 3 years in interest

Lease is 100% tax deductible so assuming tax rate is 25%

£11,558.40 X 25% = £2,889.60

Therefore, the lease is effectively self-financing and the reduction in tax to be paid (£2,889.60), more than covers the interest charge (£1,558.40)

Renting or leasing assets can be tax efficient - this can reduce your overall tax bill, as the cost is deductible as a business expense. This is a factor in determining whether you should rent or lease an asset, rather than buy.

Contrary to popular belief leasing is not expensive, in fact the real cost of your lease can be significantly lower than the payments you make!