Asset Finance

Funding solutions for SMEs

Asset Finance

Asset Finance is a simple and flexible way to finance business critical assets that make a valuable contribution to the performance of your business, such as equipment, plant, machinery, software. It also allows you to release cash from the value locked into the assets you already own.

We can have specialist lenders who will fund vehicles over 10 years old, office refurbishment, CCTV and gym equipment, among other hard to finance assets.

Hire Purchase

This type of funding allows companies to acquire an asset while paying for it in instalments at the end of the term, you have the option to purchase the asset or not, as you see fit. This type of funding allows you spread the cost of your investment over the life of the asset, making it easier to budget for. Thus, it is particularly suitable for purchasing machinery, vehicles, commercial and construction equipment.

Benefits of Hire Purchase:

  • Time – Spread the cost making payments more manageable
  • Control – For tax purposes you are the owner of the asset and can normally claim capital allowances
  • Tax efficient – You can offset your hire purchase interest and charges against pre-tax profits
  • Reclaim VAT

We work with lenders that can finance almost any asset, including older vehicles and equipment.

Refinance/Capital Release?

This is a quick way to access the value of assets and use their value elsewhere within your business – perhaps to ease cash flow. ‘Sale and HP Back’ is a type of refinance usable against most types of equipment. The lender purchases the asset and finances it back to you with repayments calculated in line with the income stream that it will generate. At the end of the refinance term, you own the asset.

Benefits Include:

  • Efficiency – You can use the asset without interruption
  • Choice – You can give your company a cash injection or use the money for other purposes
  • Spread the cost further
  • Make fast decisions – Releasing capital can help you make faster decisions when negotiating business contracts

What is a Finance Lease and what are its Benefits?

A Finance Lease will allow you to use the equipment you need without having to buy it, reducing cash flow problems and allowing your company to expand without crippling financial implications. Your company will make simple monthly repayments, which can be tailored to your needs and flexibility. During the agreed period, you will pay the full cost of the asset, including interest. When the end of the primary lease term is reached may:

  • Sell the asset and keep a portion of the income from the sale
  • Return the asset
  • Continue to use the asset by entering a secondary agreement

The benefits include:

  • Low initial outlay – No large up-front investment
  • Flexibility – Repayment terms can be adapted to suit cash flow
  • Cash back – You can sell the asset when repayments are complete
  • Tax efficient – Rentals can usually be offset against pre-tax profits
  • Reduce costs – VAT can be reclaimed on rentals

What is an Operating Lease and what are its Benefits?

Like a Finance Lease, an Operating Lease allows you to rent the asset while you need it. The key difference is that an Operating Lease is only for part of the asset’s useful life, meaning that you pay a reduced rental cost based on it’s purchase price and the residual value of the asset at the end of the agreement. Thus, your company full use of the asset without the burden of responsibility of disposing of it or recouping its residual value.

The benefits include:

  • Low initial outlay – No large up-front investment
  • Freedom – Full use of the asset without having to buy it outright
  • Flexibility– Option to re-rent, purchase or return the asset at the end of the term
  • Pay less – Rental cost is reduced as it is based on a percentage of the original capital cost
  • Tax efficient – Rentals can usually be offset against pre-tax profits
  • Reduce costs – VAT can be reclaimed on rentals

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Let us reduce the risk and save you time and money sourcing funding for your business!

SME funding UK Ltd is authorised and regulated by the Financial Conduct Authority (772970) and we are a Member of the National Association of Finance Brokers (M/0122/16)

We are also registered with the Information Commissioner’s Office (ZA209808)

Please note SME funding UK Ltd are brokers and not a direct lender.