Lease
Rental
Lease
Rental is a form of finance facility offered by finance providers
to business customers looking to acquire equipment for their business
on finance rather than purchasing the equipment outright. Lease
rental is very popular amongst businesses as it offers 100% tax
relief on each of the rentals paid. Depending on what bracket
corporation tax your business falls into, this in real terms can
equate to a worthwhile overall percentage relief on the actual
lease rentals themselves. Typical equipment businesses use lease
rental for include catering equipment, telecoms equipment, IT
equipment, vehicle tracking equipment, medical equipment and laptops
to name only a few. Lease Rental allows a business to budget a
monthly cost for their equipment, being a fixed cost product the
monthly lease rentals typically do not change and are fixed payments
throughout the duration of the lease itself. Being a Lease Rental,
the business doesn't own the equipment as it is renting the equipment
from the finance house who has paid the supplier and bought the
title to the equipment.
With most lease rentals it is the responsibility of the equipment
supplier to offer warranty and back-up for the product, leaving
the finance house to act purely as the financier of the equipment
itself. Lease rentals also allow a business to keep other lines
of finance free, such as commercial loans, overdrafts, etc from
the bank to use at a later date if needed. Lease renting equipment
is typically underwritten on the strength of a company's balance
sheet. The underwriters normally look for three to four times
cover based on the net worth or shareholders funds of the busines
requiring funding, other factors the underwriters consider will
be the length of time the business has been trading, previous
and current credit history, and the general performance of the
business itself.
Where a business may be a new start, the underwriters will often
also look for security in the form of a Directors Guarantee, this
is typically based on the directors being homeowners and having
adequate equity in their personal or business properties to back
the guarantee. Lease rental has become one of the most popular
forms of finance for businesses acquiring equipment, to get a
free quote please submit your details below.
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