A finance lease enables you to rent an asset from the finance company for your exclusive use for an agreed fixed term period. This option is ideally suited to businesses with temporary requirements for equipment, however, leasing continues to become the funding style of choice for many companies. Finance leasing makes sense, as generally speaking, businesses gain profitability through use of the equipment, not from owning it. Different companies achieve different benefits from leasing solutions.
As the finance company will usually always retain ownership of the asset, you will not be able to claim capital expenses. However, the payments, which are typically lower compared to a hire purchase agreement, and any maintenance costs can be classed as a trading expense. Entering a lease agreement does not affect lines of credit, providing flexibility should you need to access additional sources of funding.
You may be looking for fixed term rates assisting with cash flow and forecasting or to benefit from available tax advantages or simply that your available capital is better utilised within other areas of your business, BFS can facilitate the right leasing solution for your business.