The leasing industry in India is growing and there are clear benefits to be had for companies of all sizes and sectors.
Leasing can deliver many benefits – not least freeing up capital to be invested elsewhere in the business.
- But there are other benefits too. Leasing guards your business against the diminishing value of assets. This allows you to focus on your core business activities without these distractions. Operating lease can be structured to reflect effective useful life rather than using depreciation as the taxation rules which generally does not match usage with the asset.
- In addition, there may be other monetary and tax advantages. In most instances, you should be able deduct the full cost of lease rentals from taxable income.
- Tax depreciation on owned assets is relatively slower than the rapid write off possible under lease, hence provides higher tax shield.
- Allows flexibility- upgrade/re-write/exchange assets during the term of the lease.
- Fixing your costs – for a set sum, you can acquire and use the asset immediately.
- Boosting your cash flow – we fix a residual value that reduces your payments