Rent to Buy
RENT TO BUY
Inflationary price increases have priced certain assets virtually beyond ownership possibilities. Monthly payments are structured to accommodate budgetary and cost constraints.
Since rental is an expense, it is 100% tax deductible. Operating rental agreements often do not require balance sheet disclosure, and hence will not affect the financial gearing of the company. In addition, it will have a marginal impact on the return on assets managed ratio.
Capital can be reinvested into core business to generate revenue instead of being tied up in depreciating assets. There is no longer a need to maintain an asset register or depreciation schedule. Equipment life is no longer determined by depreciation periods.
All repairs, spare parts and insurance during the rental period will be for the lessee’s account.
The responsibility rests with the Lessee to insure all components and aspects as a whole, in case of theft, malicious damage, adverse weather damage or any other damage other than normal wear and tear.
An option exists to purchase the unit. The basis of take-over will be one (1) further premium after the expiration of the lease period.