Lease v Buy

By leasing equipment your business could benefit from tax relief on the profits you earn.

Tax relief is also available for cash purchases, so have a look at the examples below to see what is best for you:

Assumptions:	Equipment Cost £8250.00
	Term 3 years
	36 monthly payments of £284.63
	Tax relief @ 21%
Lease Rental
Year	Monthly Payments	Tax Relief @ 21%
1	£284.63 x 12	£717.27
2	£284.63 x 12	£717.27
3	£284.63 x 12	£717.27
	Total Tax Relief	£2151.81
Paying Cash
Year	Capital Allowances	Tax Relief @ 21%
1	18% of £8250.00 = £1485.00	£311.85
2	18% of £6765.00 = £1217.70	£255.72
3	18% of £5547.30 = £998.51	£209.69
	Total Tax Relief	£777.26

Notes: Equipment costs and monthly payments assume VAT should be added. The above are for example purposes only and tax relief is based on 21%. Always consult your accountant or financial advisor to see what is best for your business.

Want to find out more about tax relief? Click here