Finance Lease

How it works

The financier purchases the equipment or vehicle you require and then leases the goods to you. You then enjoy the use of the vehicle or equipment for an agreed time in return for a series of rental repayments.
You can finance the outlay you've already made for goods purchased in the last six months.

What is the lease agreement?

The lease agreement sets out the:

• Residual value of the goods
• Term of the lease in months
• Monthly rental
• Depreciation rate

When the lease expires

You can choose to:
Return the equipment to the financier who can sell it in the market place (you would need to make up the shortfall if the net sale was less than the agreed residual value)
Take up any invitation the financier may give you to purchase the equipment

No initial cash outlay

A finance lease gives you immediate access to the goods your business needs without a capital outlay so you can put your day-to-day cash flow to better use.

Negotiate your payments and residual value

Within an approved range allowing more flexibility in budgeting

Flexible terms

Match your finance to the length of time the asset is required – from one to five years

Match your cash flow

You can arrange to make a balloon payment at the end of the loan to reduce repayments throughout the term.

Tax deductible

Rental payments are fully tax deductible if the equipment is used solely for earning assessable income. Speak to your accountant for further information about tax benefits.

Free up other valuable assets

The equipment being purchased is normally sufficient security for the finance – your other business assets are not required as security.

Interest rates

The rentals are fixed throughout the life of the loan.

Term

One to five years.

Repayment frequency

Monthly

Repayment methods

Direct debit and periodical payment from a nominated bank account or BPAY®.

Other details

The residual value of the leased goods is established in accordance with a schedule issued by the Commissioner of Taxation.
Lease rentals are usually tax deductible if the leased goods are used to produce assessable income.