Operating Lease

Operating Lease

  • Terms of 12-60 months
  • Off-balance sheet finance arrangement
  • Rentals are tax deductible
  • Ability to upgrade goods at or before contract expiry and renegotiate terms
  • Options include purchase, re-rent, return of goods
  • Amount financed is net of GST
  • GST charged on monthly rentals (ITC available to ABN entities registered for GST)

The benefits of a Rental/Operating Lease

Off-balance sheet funding benefits: your rental agreement will not usually appear on your balance sheet as a liability. The monthly rentals are treated as an operating expense and are usually considered 100% tax deductible

Manage your working capital more effectively: rental gives you the option to obtain new equipment without tying up your working capital. Rental payments are fixed for the term of the facility. The low implicit interest rate gives you a cost-effective method of acquiring new equipment as well as giving you the most equipment for your dollar
Flexible end of term options: at the end of the rental term the lessee will have three alternatives:  (i) upgrade or replace with new equipment; (ii) extend the rental period with reduced rental repayments; or (iii) return the equipment with no further payments required

Finance the total solution

  • Terms of 12-60 months
  • Off-balance sheet finance arrangement
  • Rentals are tax deductible
  • Ability to upgrade goods at or before contract expiry and renegotiate terms
  • Options include purchase, re-rent, return of goods
  • Amount financed is net of GST
  • GST charged on monthly rentals (ITC available to ABN entities registered for GST)