Contact Us Today!
Factory owner who uses finance leasing to purchase business equipment

Definition of a finance lease

“A Finance Lease is a means of renting a business asset through regular monthly payments. With a Finance Lease, the asset remains the property of the finance company even after the agreement has ended.”

If you rely on expensive equipment, vehicles or machinery to run your business, it can be hard to pay for them outright, especially if they need updating regularly. A finance lease lets you use the latest equipment and technology without draining your funds or using up cash reserves.

How a finance lease works

A Finance Lease is essentially a rental agreement – you pay a monthly sum for the use of an asset, whether it’s the latest computer equipment or a fleet of vehicles.

The lease will run for a fixed term, and as long as you keep payments up-to-date, you will have exclusive rights over the asset for the duration of this period. Unlike hire purchase, at the end of the term, ownership of the vehicle or equipment reverts to the lender.

Why choose a Finance Lease?

If your business relies on cutting-edge equipment or the latest IT technology, a Finance Lease is often the best option because at the end of the term, you can update your assets and enter into a new lease agreement for something that is more modern. Alternatively, if you are happy with the item you are leasing,  you  might want toenter into a new agreement and extend the term or offer you may even have the option to buy the asset in some cases.

A Finance Lease presents all the benefits of an upfront purchase but without the cost or commitment and is a popular type of asset finance.

If you choose a Finance Lease, the agreement usually carries some tax and VAT benefits for your business too. The monthly payment can usually be offset against your tax bill, and you can claim up to 100% of the VAT back on the asset if it is used exclusively within your business.

With all asset finance, the agreement is usually secured against the item itself, so don’t assume that you will struggle to obtain lease finance if you have a chequered financial past or your business is lacking a solid trading history.  The leasing company will simply assess your circumstances to understand if you meet their lending criteria.

Whether you are running a gym and need to keep your equipment up-to-date, or operating a taxi firm that has to have the latest technology to maximise efficiency, lease finance is a great way of keeping your assets up to date without depleting your cash reserves.

A Finance Lease is ideal if you need high-value assets that need updating regularly and you are happy to deal with administrative responsibilities such as repair or insurance. Some of the solutions we have found include:

  • Finance Lease for coaches
  • Finance Lease for warehousing equipment

Call us today on 03330 069 141 to find out if we can find lease finance for your assets to help you stay one step ahead of your competition.

Our Latest Blogs

  • Construction Finance: Funding Challenges & Solutions

    Securing mainstream construction finance was never a simple enterprise, but it’s actually getting harder. This is especially true in the UK, where scrutiny from lenders has intensified over recent years, making it trickier and more time-consuming than ever for construction firms - even those with a healthy order book and a history of sound financial conduct - to secure the finance they need to grow.

  • Engineering Finance: Which Funding Option Is Right For Your Business?

    The success of your engineering business often comes down to getting the right funding at the right time. Should you invest in sales or technology? Have you identified new products or new economic territories? What are your funding options and how should you be using them?

    UK engineering firms are continually praised for their engineering excellence and there is a strong tradition to maintain. Current engineering feats like Crossrail, Leeds’ new £45m flood alleviation scheme, the new Forth road bridge and the Olympic Stadium show that British engineering ability is still as innovative today as it was in the time of Brunel.

    But it isn’t without its difficulties and finding appropriate finance is often at the very heart of meaningful progression and innovation.

    There is a real need for flexible finance to react to the changing market conditions, which includes the current uncertainty of an EU trade deal as well as the opening up of other overseas markets.

  • 8 Ways Unsecured Loans Can Help Your Construction Business Thrive

    The importance of finance within the construction industry cannot be understated. Not least because it is the most competitive and payment-delayed industry in the UK. Understanding how the financial challenges affect your business is just the start.

  • What Is Commercial Property Finance and Should You Invest?

    There aren’t many cash buyers when it comes to commercial property development. Anyone involved in this sector usually requires large-scale finance for their projects. Are you looking to develop a commercial project and if so should you even be looking to invest in property development?

    If you’d like to understand whether you want to invest in commercial property, you need a clear distinction on what a commercial property is, how it will be developed and whether you can afford to purchase it. Then, you need to consider whether taking commercial development finance is right for you and if the economic forecast makes it a good time to invest.

Hot from Twitter

An £85,000 funding boost provided by Access Finance has helped Peters Department Store in Huddersfield, by revitalising their brand and refitting their new premises. Find out more at bit.ly/2zJPSlB pic.twitter.com/hc9C…

About 15 hours ago from Access Commercial's Twitter via HubSpot · reply · retweet · favorite

Contact Access Commercial Finance Today