Leasing Info & Help
Operating Lease
A cash flow based product, which is often suited to contract work, operating lease is where the risk of equipment ownership is completely removed from your business. Disposal of the asset is taken care of and the finance is off the balance sheet, which can improve finance ratios for reporting. This leasing option is usually suitable for larger assets and particularly heavy plant and equipment or commercial vehicles where there is an established residual value.
Operating Lease Example:
A lease for a printing press costing £400,000 may include a residual value at the end of the primary period of £150,000. The
primary rentals are thus based on £250,000 and not the capital cost of £400,000. Due to the fact that the asset needs to be
sold on at the end of the primary period to recover the residual value, it is very rare for an operating lease to have a
secondary rental period.
With an Operating Lease you may source the supplier, but it is often the case that we, the leasing company can acquire the asset for you cheaper. You will have to pay any documentation fee and an initial payment of a multiple of rentals.
