Although the concept of ownership may sway many to purchase IT equipment for their company, offsetting the cost by employing the benefits of leasing over purchasing often proves to be a more savvy option. Leasing allows the company to retain capital as opposed to splashing out a four or five figure sum on items prone to heavy depreciation and breakdowns. By leasing, payment is made in monthly or weekly increments, which is likely to have a positive impact on cash flow, particularly for recently established companies fighting to break even. Despite this obvious upside, many decision makers in small businesses still opt to dent their capital by buying computers and the like outright, there is a good chance they hadn't considered the other major reasons for choosing to lease: Simplicity IT leasing does not require a deposit, nor reams of paperwork or a lengthy wait for contract approval. The whole process can be carried out quickly and efficiently - applications for leasing can easily be made online, over the phone or in person, and although subject to a credit check, tend to offer a faster answer on approval than other finance options. Unlike the compound interest associated with loan financing, with leasing all payments are for the same amount. Affordability Aside from the obvious fact that the cost of any equipment is spread over a long period of time, there is also the fact that leasing is not subject to interest or any hidden and escalating fees. A monthly cost is established at the beginning of the contract and sustained over the leaser's choice of either 3 or 4 years. There is no risk of paying over the odds and absolute clarity of price from the outset, so whatever a business's requirements, they will never find themselves going over budget. Tax Benefits As the equipment is used for business purposes: in the majority of cases, rental payments will be 100% tax deductable. There are exceptions, so a quick consultation with a qualified accountant in consideration of specific circumstances is advised, but more than likely the actual rental can be entirely offset as an expense and essentially cost you nothing. Upgrades and Buyouts A top quality leasing company will incorporate both the option to upgrade leased hardware part way through the lease agreement and the option to purchase the equipment for a nominal fee at the end of the term. These options provide the flexibility to change computer hardware to reflect the changes the business has gone through since taking out the lease, and side-steps the issue of being stuck with unneccessary equipment which was expensive but now has a low re-sale value. Copyright (c) 2010 Jamie Lyons
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