Finance lease
The funder buys the asset and leases it to you. Rentals can be tailored to usage and cash flow. At the end of the primary term you may enter a secondary rental, sell and keep a portion of proceeds, or return the asset.
- Range
- By asset value
- Term
- Matched to use
- Family
- asset
- Search
- Full market, one file
At a glance
- Use without ownership
- Cash-flow tailored rentals
- End-of-term options
- Fixed cost
How it works
- 1The funder buys the asset and leases it to you.
- 2You pay rentals over a primary term tailored to usage and cash flow, covering cost plus interest.
- 3VAT is claimed on the rentals.
- 4At the end of the primary term you can enter a secondary rental, sell the asset and keep a portion of proceeds, or return it.
Who it’s for
- Businesses that need the use of equipment without buying it outright
- Companies that want a lower initial outlay
- Operators who may not want the asset at the end of the term
Good to know
Rentals can usually be offset against pre-tax profits.
You do not take title in the same way as HP.
One application with QED searches the full market. That saves you running the same file around several lenders, and it avoids multiple credit searches on the business and directors. A hard search is only placed when you proceed with a chosen lender.
Hire purchase vs finance lease vs sale & leaseback
Tax treatment depends on the agreement and current HMRC rules — confirm with your accountant. Comparison drawn from qedfinance.com/assetfinance.
What it is
Hire purchase
Buy the asset in instalments. Title transfers when you exercise the option.
Finance lease
Use the asset without buying it. Funder owns it; you pay rentals.
Sale & leaseback
Funder buys kit you already own and finances it back on HP or lease.
End of term
Hire purchase
Purchase option — you take title
Finance lease
Secondary rental, sell and keep a share of proceeds, or return
Sale & leaseback
Same options as the HP or lease you took back on
VAT (typical)
Hire purchase
Paid with the deposit and with each instalment; reclaim on the capital cost (current rules)
Finance lease
Claimed on the rentals
Sale & leaseback
Follows HP or lease treatment
Tax (typical)
Hire purchase
You are treated as owner — capital allowances often available. Interest may offset profits.
Finance lease
Rentals usually offset against pre-tax profits. No title in the HP sense.
Sale & leaseback
Ask your accountant — it is a sale then a hire/lease back.
Best when
Hire purchase
You want to own the asset and claim allowances
Finance lease
You want use without ownership and a lower initial outlay
Sale & leaseback
You need cash from unencumbered plant, vehicles or machinery
Documents QED will ask for
Same list as the attach-files section on the website application. Tick what you have when you apply; email the rest.
- Last published accounts (full accounts, not abbreviated)
- Latest management accounts if year-end is stale
- Last 3 months’ business bank statements
- Supplier quote, invoice or pro-forma for the asset
- Proof of ownership / V5 / serial numbers (sale & leaseback or refinance)
- Settlement figure if the asset is already on finance
FAQ
Drawn from qedfinance.com and the way the UK market actually underwrites these facilities.
HP or lease — which is better?
HP if you want ownership and capital allowances. Lease if you want use without title and VAT on rentals. QED will price both if the asset fits.
Can I settle early?
Usually yes, at a settlement figure. Check the agreement for any early-termination terms.
Finance lease or operating lease?
A finance lease usually covers most of the asset’s useful life and the rentals repay cost plus interest. An operating lease is closer to a rental — useful if you want to upgrade regularly and not take residual-value risk. QED’s core product here is the finance lease described on qedfinance.com/assetfinance.
What are the end-of-term options?
Enter a secondary rental, sell the asset and keep a portion of the proceeds, or return it. You do not take title in the same way as HP.
New or used assets?
Both. Hire purchase, leasing, sale & leaseback and refinance can all be arranged against new or used plant, machinery and vehicles, subject to age and residual value.
Can repayments follow seasonality?
Yes. Many funders will structure rentals around seasonal cash flow rather than a flat monthly profile.
Does a low credit score rule me out?
It can limit options with some houses, which is why a broker search matters. QED matches the file to lenders whose criteria fit.
Prefer a number first?
Model an illustrative structure, email yourself a copy, then apply if it looks right.
Open the calculatorQED is a broker, not a lender. A low credit score can limit options with some houses; a search with us does not place a hard search on the business or directors until you proceed with a chosen lender.