02 Apr Pure or financial lease What works more for your business?
There are several financing instruments that small or medium companies can use to improve or grow; Pure leasing and financial leasing are two of them. And then we will share with you the necessary information, so you can determine which is the one that works for your business and thus achieve your goals.
Pure leasing is the way in which you can enjoy a good, necessary for the activity, in exchange for paying monthly for it. For small and medium businesses, this type of lease includes that of real estate, machinery or equipment, which together serve to operate and provide service.
It should be noted that the way in which this type of lease works is through a specific term. And once this is finished and the agreement has been settled in its entirety, the asset will continue to belong to the lessor.
In fiscal matters, it is an expense that can be deducted directly.
It can generate a better leverage of the business.
It will not affect maintenance costs.
If the leased property is your main tool, in the long term it will not be affordable.
Once the contract is finished, the goods must be returned.
On the other hand, financial leasing is the granting of the right to use certain assets, which is established in a medium or long term. Here, the payments that must be made are calculated according to the real value of the property, since there is an opportunity for it to be acquired by the lessee, at a lower cost than the real one, once the lease is finished.
Within this type, the landlord represents the legal owner, while the tenant represents the tax owner. Thus each of them must be awarded and comply with the respective obligations.
In tax matters, the amparo can be registered under the ISR and VAT laws.
You do not lose liquidity for the acquisition of goods.
Payments are taken on account in order to acquire the property.
The term of the lease may depend on the value of the property.
Once having the good, it can represent new expenses.
Which one can work best for your business?
There are three aspects that can help you assess your situation and choose, since according to the needs and vision you have for your business, you must make the decision of whether the pure or financial lease is the most appropriate.
# 1 The liquidity of your business
To begin, you can analyze if acquiring the good will generate expenses that affect the liquidity of your business. That is, if you consider that having the good will represent an expense in the future, which can greatly reduce the amount of money you have to meet your usual obligations, pure leasing can be the best option. This would allow you to safeguard your capital and also receive the deduction of the corresponding tax for the rent.
# 2 Performance in the future
You should also consider that if the good or tool represents being indispensable to operate, it would be more viable to acquire it at the end of your rental contract. That is, in this case the financial lease would be the best option, since you can save your money, acquiring the good at the end of the contract for a lower price than the real one and above all keep it for your daily operation.
# 3 Innovation in the market
Finally, it is good to put in the balance the constant innovation that exists in the market regarding the goods that you consider to lease. Since if these change every year or it is very likely that new solutions arise in the short term, pure leasing can work better.
Now that you know more about pure leasing and finance, you can make the right decision for your business needs. Remember that there are several options that can help give you the boost you need to grow, you just have to take advantage of them.