Leasing
This leasing or financial rental comprises a source of financing which gives companies who need production equipment the possibility to obtain it.
Using this system of financing, the leasing company acquires customer’s chosen equipment and simultaneously lets them use it for a period of time at a determined price.
When this contract finishes, the leasing company has the following options:
- Return the equipment to the company.
- Draw up a new rental contract.
- Purchase the equipment at its residual value.
Main advantages for the leasing party:
- Accelerated AMORTISATION of the equipment. This situation involves paying less tax by reducing the profit from increasing taxation costs cancelling out the financial load with greater tax savings.
- Their own resources are not tied up. As they can use the equipment without having to compromise their own cash flow, the company does not lose liquidity and obtains profitability by putting their money into other types of investments.
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