Leases are fundamentally contractual agreements..
A Finance Lease can be a tax effective method of financing the full value of an asset. The lease is a legal contract between the lessor (bank) and lessee (customer).
Leases are used to finance many tangible assets such as vehicles, office equipment, software, trucks and farm machinery. The assets are owned by the financier. The customer has possession and use of the asset in return for making regular lease/rental payments. Once the final payment has been made, including any residual/balloon payment, the ownership of the asset transfers to the customer.
Is a finance lease the right choice for you? There are several factors to consider. GST is payable on both the monthly lease payment amount and the residual. Input tax credits may be available if you are registered for GST. You may be able to claim the full rental amount as a tax deduction if the amount financed is under the depreciation limit set by the ATO. If the amount financed is above the depreciation limit, then you may be able to claim the interest charges on the lease and on the depreciation.*
Appropriate financial advice through your accountant or financial advisor is strongly recommended to determine the best option.*
Max loan term is 7 years.*
Finance 100% of the asset value*
* Applications for credit are subject to the financier's normal credit assessment criteria. Fees or charges may apply. Full details of all product terms and conditions are available upon request. Any taxation information provided is only general in nature and does not constitute tax advice, nor is it necessarily applicable to your particular circumstances. Farm Machinery Finance strongly recommends that you consult with your accountant, financial advisor and lawyer to determine the most suitable lending option for your particular circumstances and whether any particular taxation laws, obligations or benefits may apply to you.