Funding Solutions
There are many ways of funding your fleet. S2 & Co will work with you to understand your business objectives and demonstrate how the implementation of different funding methods can support your aims over the short, medium and longer term.
We can help you to evaluate your most appropriate fleet funding method and then using our network of industry partners secure the optimum arrangement for your business.
Potential solutions may include:
Contract Hire
Contract Hire is a flexible way of enjoying the benefit of an asset without purchasing it outright. The leasing company supplies the asset to your specification with or without maintenance provision; contracts can also include tyre cover and a relief vehicle in the event of a breakdown.
The finance company bears the risk of recovering the rest from resale of the asset at the end of the agreement.
Benefits include: [read more]
- Reduced fleet administration
- Road fund licence provided for duration of contract
- Optional repair & maintenance package
- Optional breakdown rescue cover
- Optional replacement vehicle cover in event of breakdown
- You have full use of the asset without buying it outright
- Rentals can typically be offset against profit before tax
- If you are registered for VAT, you can normally reclaim VAT on the rentals
- Rentals are considerably reduced as they are based on a percentage of the original capital cost
- Rentals can be arranged to mirror customer's cash flow
- End of term flexibility - the opportunity exists to re-rent the asset for a further term or you simply return the asset
- Flexible rental terms from 2 years upwards. Rental periods can be matched to the planned use of the equipment
- This form of funding can be classified as "off-balance sheet" funding subject to conditions approval
Hire purchase / Lease Purchase
Both hire purchase and lease purchase give you eventual ownership of the asset at the end of the repayment term.
Benefits include: [read more]
- Fixed monthly payments allow you to budget over the term
- Simple documentation
- A means of spreading the cost over the useful life of the asset
- You are the owner of the asset for tax purposes and can claim capital allowances
- Monthly repayments do not attract VAT
- Hire purchase charges can be offset against profits for taxation
- If you are registered for VAT, you can reclaim VAT on the capital cost of the asset.
Operating Lease
An Operating Lease is a flexible way of enjoying the benefit of an asset without purchasing it outright. Low rentals are achieved by basing them on a percentage of the initial capital cost of the asset. The finance company bears the risk of recovering the rest from resale of the asset at the end of the agreement.
Benefits include: [read more]
- You have full use of the asset without buying it outright
- Rentals can typically be offset against profit before tax
- If you are registered for VAT, you can normally reclaim VAT on the rentals
- Rentals are considerably reduced as they are based on a percentage of the original capital cost
- Rentals can be arranged to mirror customer's cash flow
- End of term flexibility - the opportunity exists to re-rent the asset for a further term or you simply return the asset
- Flexible rental terms from 2 years upwards. Rental periods can be matched to the planned use of the equipment
- This form of funding can be classified as "off-balance sheet" funding subject to conditions approval.
Finance Lease
Finance leasing allows you the full use and benefits of an asset but without the potential burdens of ownership as this rests with the lessor.
Benefits include: [read more]
- Flexible rental patterns and lease periods
- If you are registered for VAT then the VAT charged on rentals can be reclaimed
- Option to extend the lease into a secondary period
- You will receive the majority of the sale proceeds when we sell the asset
The lease period will be set for the useful life of the asset and at the end of the term you will have two options:
- Sell the goods to an independent third party and be offered the majority of the sale proceeds
- Enter a secondary rental period and continue to use the asset
Sale & Leaseback/Replacement
Sale & Leaseback is a facility to release the equity in wholly or partly unencumbered assets allowing an instant capital injection into your business. Owned assets are purchased by the leasing company and leased back or replaced by new assets on a new funding agreement.
Benefits include: [read more]
- Assists cash flow by injecting capital into the business
- You have continued use of the asset being refinanced
- The capital raised allows for the purchase of other business assets not normally considered suitable for standard hire purchase or leasing agreements
Rental
Assets are hired on open ended rental agreements which can be terminated at short notice. Whilst on hire the rental company retains all responsibility for repairs, maintenance, tyres, etc.
Benefits include: [read more]
- Ultimate flexibility
- Allows you to respond quickly to short term requirements
- Allows you the option to try before you buy
- Rentals can typically be offset against profit before tax
- If you are registered for VAT, you can normally reclaim VAT on the rentals