Leasing

Leasing is a financial arrangement that allows us to buy material goods as if we were taking them on a long-term lease. The "rental fee" is actually an installment payment, while the asset remains in the seller's possession until the end of the term and is also this cover for him. At the end of the term, the asset can be ours.

You can't and don't have to buy everything right away, things (tools, machines, equipment, vehicles) can be rented or leased. It happens that a business needs assets for which it does not have the money at the moment. In such cases, we can apply for credit to the bank, but before we do that, let's look around the leasing market, because we might find the solution there. 

Businesses usually turn to the bank for a loan if they want to buy something for which they do not have the money at the moment. But the bank is serious collateral requires, examines the business thoroughly and is not at all sure creditworthy find it. However, it is also worth considering the choice of a leasing structure if there is collateral and the company is also creditworthy, because it may happen that the business will do better with the lease than with the loan. 

The essence of leasing is that the asset used by us remains the property of the taxes, and this is also the cover for him, the lessee only receives the right to use the given asset in exchange for the lease fee. The taxes thus assumes a lower risk than a bank providing a loan, since the collateral can be sold at any time if necessary, unlike the bank with a mortgage mortgaged apartment, in which they also live. 

An important point is that the lease fee can also be considered as the price of a kind of service, so it can be accounted for as a cost. This can have many beneficial effects for a company. However, before a company commits itself to leasing financing, it is worth consulting with the company's accountant so that the decision can be made based on the current tax rules and all applicable discounts.

There are several types of leasing, depending on how the ownership of the leased asset changes term at the end. By default, the asset is transferred to the ownership of the lessee, this type is called closed end for leasing. In addition, there are financial, open-end and operational leasing. 

The in financial leasing the asset remains the property of the taxes for a specified period of time, until the end of the term. During this time, the lessee pays a lease fee and uses the asset. At the end of the term, the asset becomes the lessee's property for free or at a predetermined residual value. 

The open ended in the case of leasing contracts, the term is also predetermined, as is the monthly lease fee. However, at the end of the term, the lessee can decide whether to purchase the asset or not. A special case of purchase is buyer designation, when the lessee can say to whom the taxes will sell the asset at the predetermined residual value. 

It is a very popular form of leasing for car leasing operative leasing. The essence of this is that the leased asset remains with the lessor at the end of the term. Because of this, operational leasing is most similar to a rental contract, and sometimes this form is called a long-term lease. Another difference compared to the previous two forms of leasing is that in this construction, the taxes often takes over certain operational tasks from the lessee, the price of which is included in the lease fee. (Insurance is typically such an operational task for motor vehicles.)

If you are looking for a leasing company, contact the professionals. Banks typically outsource this activity to a separate company, so there is a good chance that our own bank also has a leasing company or recommends a company with which it has a contractual relationship. It could easily be that we do best with this institution, the administration will be the easiest here, because the leasing company also likes to know who it is dealing with. 

Mainly in the area of car leasing, there are also leasing companies that specialize in this area, which can provide us with a better solution if appropriate. If we contact such a company, when reviewing the offer, we should not only consider the lease fee, but also what operational tasks the taxes undertakes.

And one more important aspect: in the case of leasing, we spread the financing of the goods we use over many years. Do not forget to carefully transfer the related expenses to our company financial and cash-flow plan as well.