Industry sector: Retail and wholesale

Office goods supplier: Leasing payments


You may decide to lease some items of equipment - perhaps your business vehicle/s - instead of purchasing them. The advantage of a leasing agreement is that the cost of major items can be spread over an agreed period, which will help cash flow.

Generally the payments are fixed at the beginning of the lease period and do not reflect movements in interest rates, although agreements over longer terms might include a variable rate option. Lease payments are made monthly.

Ownership of a leased item always remains with the leasing company, although you will normally be responsible for maintaining the item.

Your equipment supplier may offer leasing facilities, but if not there are a number of companies that do. Members of the Finance and Leasing Association (FLA) abide by their Business Finance Code where applicable.

There are various helpful booklets available from the FLA, including Why use asset finance? and FLA Skyline. Other helpful guidance on asset finance and leasing is also available on the FLA website.