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Commercial Leasing

When considering buying plant and equipment, motor vehicles or any other business asset the main issue is finding the best financing solution to match your business needs.

In doing so businesses should consider and weigh the effects between funding the purchase from valuable working capital, or through commercial leasing the asset with careful consideration to not increase the overhead or fixed cost structure beyond which the turnover and margin can support.

Accordingly, the right financing solution is the key to the successful operation of any small to medium size business.

Business Money can assist you with financing just about any type of equipment in many different circumstances:

  • Car loans
  • Commercial equipment leasing
  • Construction equipment leasing
  • Medical equipment leasing
  • Commercial car & truck leasing
  • Second-hand equipment leasing
  • Sale & Leaseback (up to 9 months old)

We also provide car leasing and equipment leasing for non business purposes.

Small to medium size business owners are frequently unable to provide sufficient documentation to satisfy many commercial leasing requirements which is why we also specialize in low doc leasing.

Lease, Commercial Hire Purchase & Chattel Mortgages are the most common forms of financing such items. The main differences between the three are outlined below:

Lease

The financier retains ownership until finalisation of the lease period and payment of any residual owing. With a lease, GST is paid monthly (not on initial purchase), there is no deposit and a residual is mandatory. The lease payments are fully tax deductible provided that the asset is utilised to generate taxable income.

Commercial Hire Purchase

The financier retains ownership until final payment is made. This form of funding is more flexible than a lease as it can include deposits or a zero residual. With a commercial hire purchase you can claim the allowable depreciation on the item financed plus interest as a tax deduction. GST does not apply to monthly payments, however the GST on the purchase is recoverable at the time of purchase.

Chattel Mortgage

You own the goods, however the financier retains title until final payment (hence the word "mortgage"). No residual is possible and deposits are not essential. You can claim the allowable depreciation and interest as a tax deduction. GST does not apply to the monthly payments, however the GST on the purchase is recoverable at the time of purchase.

When comparing quotes, you should be aware that not all charges may be disclosed.

Focussing solely on the interest rate may be misleading as the best guide is often the monthly repayment amount.


Make sure you also ask the following questions:

  • Are there any up-front costs, e.g. establishment fees, etc?
  • Are there any penalties for early payment?
  • Are there any penalties if I decide to change-over my vehicle?

Commercial Leasing is just one aspect of the funding equation.

We also specialise in bad credit car finance.

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