Do you need to use a vehicle or other asset for an extended period of time, but don’t want to pay typically high rental rates? Do you want to fix maintenance and running costs and change vehicles frequently? Are you not sure whether renting or buying a vehicle or other asset makes the best business sense? If so, a lease agreement from Absa could be the right choice for you.
A lease agreement from Absa will allow you to own costly items without having to purchase them and helps you to avoid accruing assets with high depreciation rates.
Leasing a car or other asset usually means lower monthly repayments as well, because you are not paying full rental rates and not buying the entire vehicle, only the part of its value that you ‘use up’ during the lease period. However, should the vehicle or other asset become invaluable to the business and you wish to keep it, you can still opt to take full ownership at the end of the agreed term.
If you like to change cars every few years and would rather invest or use the money you save each month in lower repayments, a lease agreement from Absa could be the right choice for you.
A Lease Agreement could be right for your business if you:
- Would like the full use of the vehicle or other asset without purchasing it
- Would prefer to pay lower, affordable monthly repayments
- Would like to fix your outlay on maintenance and running costs
- Would like the option of buying the vehicle at the end of the lease period, without the obligation of having to do so
- Would prefer to use the money that would be set aside for a instalment agreement and invest it in other areas of your business
- Would like the tax benefit of VAT being levied on the full purchase price of the asset, in addition to the extras
- Are able to pay a deposit on the vehicle or other asset
- Are able to provide insurance for the vehicle or other asset
- VAT levied on the full price of the vehicle or other asset, and possible VAT input credits
- The convenience of driving the vehicle or other asset of your choice without the hassles of ownership
- Affordable, fixed monthly payments that are tax deductible
- At the end of the lease, you can choose to purchase the vehicle or other asset at an agreed price, or nominate a third party to buy it, or continue to use it at a reduced or null rental fee
- Fixed or variable interest rates that are highly competitive
- The option to pay off the vehicle or other asset earlier than the agreed period of the contract without penalty
- Comprehensive insurance on the vehicle or other asset
- The choice of lower monthly repayments by opting to make a balloon or residual value payment at the end of the lease
- The flexibility of choosing a repayment period of 24, 36, 48, 60, 72 or 84 months
- An initiation fee and a monthly service fee will be charged on all new contracts