Finance Features - Finance Lease |
| Purpose |
- Available for companies and business professionals to buy business goods such as motor vehicles, trucks, industrial plants, professional or earthmoving equipment.
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| 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.
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| 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
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| 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
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| Product Benefits |
| 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.
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| Negotiate your payments and residual value |
- Within an approved range allowing more flexibility in budgeting
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| Flexible terms |
- Match your finance to the length of time the asset is required – from one to five years
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| Match your cash flow |
- You can arrange to make a balloon payment at the end of the loan to reduce repayments throughout the term.
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| 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.
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| 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.
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| Interest rates |
- The rentals are fixed throughout the life of the loan.
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| Product Features |
| Term |
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| Repayment frequency |
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| Repayment methods |
- Direct debit and periodical payment from a nominated bank account or BPAY®.
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| 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.
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