How to Lease Equipment for your Business

Buying equipment outright for your business may be an expense out going early on so you should consider leasing where appropriate.

When setting up your business, depending on the nature of your industry, you may have a lot of out goings to begin with. There are different kinds of leases / finance you can get which we will detail below. You can get 0% interest on some finance agreements, spread out payments to help with cash flow, tax relief on energy efficient equipment and can even have maintaining and servicing included.

If you buy or use hire purchase for equipment for your business, it will have to be added to the business’ balance sheet however if you use finance lease or an operating lease it may not. If your total payments, excluding maintenance and servicing, amount to less than 90% of the total market value of the piece of equipment it won’t need to be added to the balance sheet. Ask the leasing agent or your accountant for a valuation if you’re unsure.

Be very specific with the requirements of the equipment you need and what kind of contract would work best for you. Get at least 4 quotes from different companies, 2 larger more well-known places and 2 lesser or local leasers. Know the market value of the equipment, new and second-hand and use this to evaluate the quotes given.