Table of Contents
What is it?
Lease finance lets you rent equipment or assets for a fixed period, rather than buying them outright. It’s a handy way to get access to the tools you need, without tying up a load of cash.
You make regular payments over a set term – and at the end, depending on the agreement, you might return the asset, upgrade it, or buy it outright.
Great for businesses that need to stay up to date with tech, vehicles, or gear that changes quickly.
Pros and Cons
| Pros | Cons |
|---|---|
| ✅ Lower upfront cost – spread payments over time | ⚠️ You don’t own the asset (unless you have a buyout clause) |
| ✅ Keeps cash flow healthier | ⚠️ Might cost more overall than buying outright |
| ✅ Easy to upgrade or replace equipment | ⚠️ Limited to specific asset types |
| ✅ Lease payments may be tax-deductible | ⚠️ May involve early termination fees if cancelled |
| ✅ Useful for vehicles, IT, tools, plant, etc. | ⚠️ Not ideal if you want long-term ownership or resale value |
When is it a good fit?
Lease finance is ideal for:
- Businesses that need vehicles, computers, tools, or other equipment
- Companies that prefer to upgrade regularly rather than commit long-term
- Situations where conserving cash is more important than owning assets
- Sectors with fast-changing tech (creative, construction, logistics, etc.)
Extra tips and things to consider
- Leasing may give you the option to upgrade midway through the agreement, which is ideal if your business is scaling fast.
- Watch out for end-of-lease terms – some agreements charge if the asset isn’t returned in perfect condition.
- Monthly payments are often classed as operational expenses and may be fully tax-deductible – ask your accountant to confirm.
Still unsure?
We can help you decide whether leasing is the best way to kit out your business – or whether asset finance or hire purchase would be a better fit.
Try our [Finance Finder Tool] or give us a shout – happy to help you weigh up the options.
