Finance Lease

This is good where assets are less susceptible to technological changes and have a long effective life.

With a finance lease your working capital is preserved and the flexible payment arrangements will help maximise your business cashflow to fund appreciating ventures.

Monthly lease payments are tax deductible and the equipment remains the property of the Financier, throughout the finance term.

Under a finance lease agreement, the Lessee is responsible for maintenance and running costs, insurance and registration fees for the leased item.

Product Benefits

• Immediate access to the goods your business needs without a capital outlay allowing you to retain funds for growth
• Finance terms from 1-5 years allowing you to match the term to the equipments useful life
• Repayments can be tailored to suit seasonal cash flow  with a known residual at term end.
• No ownership obligations – choose goods for your business and rent them for a set period
• The financing is supplied using the equipment as collateral or security against the debt.
• Allows you to budget exactly for the fixed rental payments, no risk of rising inflation or interest rates

Tax & GST implications

Under a finance lease agreement, the funder pays the GST which is applicable to the initial purchase of the goods under lease. The borrower is not liable to pay the GST on the purchase of the goods however, each instalment amount paid under the agreement is subject to GST.

All businesses registered for GST can claim the GST portion of each payment as an input tax credit.

The final residual amount payable under a lease agreement is also subject to GST.