OK, so you’re sold on the idea of using asset finance. Excellent. That’s the hard bit taken care of. Now it is time to decide what type of finance is best for you. At this point, financing can get very serious and very stressful: if you let it. Our job is to make sure that it doesn’t.
At Azule we will work hard to understand your business and your financial position and tailor our funding solutions so that they work for you. We will be very happy to advise you on the most appropriate deal.
However, we also know that this is your money and that you need to know what is going to happen next and over the coming months. So here is our Pocket Guide To Asset Finance.
Pocket Guide To Asset Finance
This is also known as HP or Lease Purchase
You make repayments over an agreed period
The kit is yours at the end of the contract
You are responsible for insuring your equipment
You pay VAT upfront but… VAT can be claimed back straight away
Interest costs can be claimed against your profits; capital costs can be offset against capital allowances
You use the kit over an agreed period
Technically, the leasing company owns the kit
Your payments can be offset against tax
You pay VAT on each monthly instalment
You have three options at the end of the agreement: return the equipment; pay secondary rentals or purchase title
This is classed as a revenue expense
You can deduct payments from your profits and loss account, giving you 100% tax benefit
Assets do not appear on your balance sheet
You don’t own the asset but… you can continue to pay for its use after the end of the agreement
You pay VAT on each monthly instalment
You will, generally, have lower repayments
You get cash using the assets that you’ve already purchased
This is ideal if you already have lots of kit
A clever way to bridge a gap in your cashflow
This is ideal for funding short-term projects
You can put all the equipment within a project on a single lease
You only start repayments at the end of the project
Of course, every deal is different. So when it comes to yours, why not have a chat with one of our friendly advisers who should be able to help you decide which option is best for you.
Call +44 (0)1753 580 500 now to find out more
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