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Finance Leasing from Construction
Finance UK
A Finance Lease is an agreement
between the Funding provider (the
lessor) and the customer (the
lessee) whereby Funder agrees
to rent a particular piece of
equipment over a set period of
time.
The Lessor obtains legal ownership
of the item to be leased, by paying
the amount as advised on the supplier's
invoice. The Lessee then has the
use of the goods and pays the
rental for that use for the term
of the lease contract. During
the term of the lease agreement,
the Lessee pays the rental and
does not obtain ownership or equity
in the item they are leasing.
Under a finance lease agreement,
the Lessee is responsible for
maintenance and running costs,
insurance and registration fees
for the leased equipment.
A tax efficient form of funding,
providing the ability to charge
the rentals against taxable profits.
Particularly appropriate if it
is likely that there will be insufficient
taxable profits to enable the
claiming of all the available
capital allowances.
A low initial capital outlay is
required and the VAT, paid on
each rental, is therefore spread
over the period of the lease.
The machine can continue to be
used after the primary period,
by paying an annual rental.
Ownership can never pass to the
customer, however, when the machine
is no longer required it may be
sold acting as agent for the lessor,
and a percentage of the ultimate
net sale proceeds are refunded
as a rebate of rentals.
- Low capital outlay
- Spreads the impact of VAT,
which is collected on each rental
as it falls due
- Tax efficient
- Accurate and efficient cash
flowPlease Contact
Us for details of our Leasing
Rates© Copyright 2005
Construction Finance UK
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