The difference between the two forms of leasing might appear small at first sight, but there is a world of difference from an accountant’s point of view. It is the Accounting Act that decides whether the leasing transaction for moveable goods qualifies as finance leasing (on balance sheet) or renting (off balance sheet). In the latter case, you process the lease charges as costs in your income statement.
Free up resources by not having to fund the purchase yourself.
The lease company takes care of the administration in relation to the purchase, including payment of advances.
You have the option of purchasing the good at the end of the agreement.
Leasing capital goods
Investments are necessary if your business is to grow. You can take your firm to the next level by purchasing new cars, trucks or forklifts. And if you opt for financial leasing or renting, you don’t even have to stump up your own funds. You choose the goods and supplier and negotiate the purchase price. KBC then acquires the commercial rights and offers you a purchase option at the end of the lease contract.
Financial leasing versus renting
Why choose financial leasing/renting?
- New cars or commercial vehicles
- New machinery
- New moveable business assets
- Choice between financial leasing and renting
- Use your company’s own funds for other purposes
- Reduced administration
- Enhanced borrowing capacity
- Pre-financing of VAT
- Purchase option
Contact your KBC Relationship Manager for practical details on the financial leasing and renting of moveable goods.