Steatite

Leasing

Tax & Accounting Benefits

Tax and accounting benefits With 100% allowances, you can potentially save between 20-40% of the cost of the lease, depending on the rate of tax you pay. There are tax and accounting benefits to companies which chose to lease rather than buy. Leasing costs are classified as an expense rather than a debt or outstanding liability which means that which means that which means that your options for debt financing or credit remain more flexible.

This status as a rental as opposed to a liability on your balance sheet is also something the banks like to see, says Jeremy Standing, sales director at lease finance firm Key Finance "The finance director or the bank will have covenants about what you can spend. They know how they want the financial accounts to look at the end of the year, which is why an operating lease can be attractive.

In terms of tax, one clear advantage is that a lease is 100% tax allowable, which means that your regular payments to the leasing firm are completely written off your taxable profit for the year. This could potentially save between 20-40% of the cost of the lease, depending on the rate of tax you pay.

Acquire the equipment you need now whilst retaining your working capital for other purposes.

This example is for an established customer with a good credit rating, financing £18,000 of equipment

 
Capital Cost £18,000

Rental per £1000 = £33.31

Term: 36 months

Calculation

£33.31 x 18 = £599.58 plus VAT per month, equivalent to just £138.36 + VAT per week

Notes:

All rates are £ per thousand

All rates and based on a 3 year term (1+35 monthly payments)

All rates are subject to status but are 90 accurate for most cases

CAT A customers are established businesses, 3 years+ with an average credit rating

CAT B customers are new start ups, under 3 years and with below average credit rating.

CAT A customer wants to finance £18000 £33.31 x 18 =£599.58 +VAT per month or £138.36 + VAT per week This above figures are just one example. Please contact us if you would like a full leasing proposal prepared for you or our full terms and conditions.

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Need help?

For sales assistance please telephone us on 01527 406880 or email us at sales@steatite.co.uk. We will always aim to provide you with a prompt response to any questions you may have.