Financial leasing

Leasing of a machine means financial lease with final purchase at the end of the commercial agreement. Client, so called lessee, uses the machine and pays series of rentals. 

The finance company is the legal owner of the asset during duration of the lease. However the lessee has control over the asset providing them the benefits and risks of (economic) ownership. At the and of the commercial agreement the ownership of the asset overcomes from lessor to the lessee. 

What are the advantages?

• lowering cash expense for purchasing new assets
• fixed interest rates for whole period of leasing contract

Advangates for businessman

• improves cash-flow; fixed series or rentals
• rentals are capital allowance
• out of balance financing - neither asset nor rentals are not included in balance sheet