When it comes to investing new equipment there are many options available for our customers. Leasing is fast becoming a popular option.
So what is leasing?
Leasing is a tax efficient and flexible way to purchase the equipment you need without compromising your cash flow. Terms are available from 1-5 years with only a minimal deposit required in most cases.
A lease rental facility is suitable for all industry sectors and any size of business. Fire Safety Wales has helped both small start-up and well-established businesses arrange to fund of assets.
For many companies, this is becoming the best way to become compliant and cover the business’ liability with minimal upfront overheads.
What can be leased?
What are the benefits of leasing?
There are extensive benefits to leasing when it comes to investing in capital equipment, especially when compared to a cash purchase.
- 100% of the rentals (both the capital repayment and interest) are tax deductible for a profit-making company.
- In most cases no large deposit is required.
- Repayments are fixed which makes for easy budgeting.
- Maintains other credit lines.
- Flexible terms from 1 to 5 years.
- Easy to upgrade when you need to replace ageing equipment with new.
- Almost all equipment types can be funded.
- Allows the equipment to pay for its self over the time period.
- Perhaps most importantly, it protects your cash flow to cover future unexpected costs or just to give you the peace of mind knowing your money is in your bank account and not tied up in equipment.
What if I have enough cash in the business to pay for the equipment?
This is one of the more common questions and it’s a valid one. Some people believe that leasing or even finance, in general, is only for companies who might be struggling or just don’t have the cash reserves to self-fund. This couldn’t be further from the truth. Many FTSE 100 companies and 8 out of 10 accountancy firms use leasing.
It’s also very common in the public sector, particularly when it comes to the education system. A better question perhaps would be “why use your own money when you can use someone else’s?” It’s a cliché, however cash really is king and never more so than post-recession. Unfortunately many SME’s have ceased trading due to poor cash flow management and in some cases have been profit making at the time they had to shut up shop for good.
Above all else, cash is vital to help you grow and progress and without it, you are in danger of choking your company.
Hotels, residential care premises, multi-tenented offices and even property management companies tend to prefer this option.
If you would like to find out more about this option then please contact us and we will be happy to discuss it further.
At present Leasing is only available to commercial customers.