What does leasing equipment mean and is it better than purchasing outright? This is always a HUGE question for any trades business, as you
need a vehicle suitable for your trade, tools, perhaps machinery plus office equipment so you can efficiently run our business.
Leasing equipment means you are able to obtain a piece of equipment and use it for an amount of time before either upgrading to the newer version or deciding that you do not require that equipment anymore.
The type of equipment that you lease is usually big ticket items like cars, large machinery like earth moving equipment, computers and other office equipment and larger tool items.
In a lease you will find that insurance, maintenance and repairs related expenses are included in the monthly cost. You don’t get a choice about what these extras cost are and who they are through.
Lets look at vehicles first to understand some of the variables that you need to consider.
If you require new machinery or equipment in order to run your day to day business, it is important to weigh up your options between leasing and purchasing the equipment. The points to consider are:
Overall the best thing to do is research thoroughly, understand all of the options that are available to you. It is a long term commitment that you need to be able to fulfill. Make sure you discuss your plans with your accountant or financial adviser as they have your best financial interests at heart and want to see you and your business succeed.