Do you currently purchase your printers and photocopiers outright with no service contact?

The benefits of leasing

Should you buy or lease your next photocopier?

There a various questions to ask when considering your new office photocopier. After choosing a make, model and specifications the next big question is likely to be how you are purchasing it.

How leasing could work out better for your business.

For companies with taxable profits less than £300,000 per year the tax rate of 20% will be applicable.

For example, let us assume you are purchasing an item of equipment. The two choices are whether to buy it for £10,000 or lease it over a 5 year period.

The example shown below is for an outright purchase for £10,000 with the customer claiming 25% written down allowances per annum.

This example shows the customer paying tax at 20% or 30%.

The overall tax saving to the customer is £1,754.19 and £2,283 if he is paying higher corporation tax.

This means that he is able to reduce his tax bill by these amounts.

Amount Write down allowable Corporation tax rate Tax benefit Corporation tax rate Tax benefit
£ £ £ £
Year 1 10,000 2500 20% 500 30% 750
Year 2 7500 1875 20% 375 30% 563
Year 3 5625 1406 20% 281 30% 422
Year 4 4219 1055 20% 211 30% 317
Year 5 3164 791 20% 158 30% 231
Total £1,525 Total £2,283

The next example below assumes a cost of £10,000 and a lease rate of £70 per thousand.

A key point to note is that with leasing the customer can claim 100% of the rentals against tax.

With leasing the overall tax saving to the customer is £3,220 or £4,200.

This means that the customer is able to reduce their tax bill by these amounts.

Amount Write down allowable Corporation tax rate Tax benefit Corporation tax rate Tax benefit
£ £ £ £
Year 1 2800 2800 20% 560 30% 840
Year 2 2800 2800 20% 560 30% 840
Year 3 2800 2800 20% 560 30% 840
Year 4 2800 2800 20% 560 30% 840
Year 5 2800 2800 20% 560 30% 840
Total £2,800 Total £4,200

Benefits our customers have from leasing.

Tax Relief

Lease payments are 100% tax deductible therefore reducing your tax burden.

No Capital Outlay

There is no capital outlay or deposit required -just the rentals paid in advance.

Budget Forecasts

Leasing provides certainty and ease of budgeting as your payments are fixed over the life of the equipment.

Also, if your business is controlled by capital expenditure budgets then leasing may well help you overcome your problems as it will be easier to obtain sign off for a lease rental amount.

Improved Cash flow

Leasing can save you from sinking capital into a depreciating asset enabling you to invest in product development, marketing or other business opportunities.

Upgrading Existing Equipment

If the equipment is purchased, it may drop in value quickly due to the ever-changing world of technology. With leasing you can upgrade at any time allowing your business to keep up with the latest technology on the market. This will mean no waiting for months or years to recover capital costs.

Future Credit

Leasing gives you an additional line of credit and does not affect your existing credit lines. Also, unlike borrowing from bank, leasing will not tie up any assets in the form of security or collateral and is not affected by fluctuations in interest rates.

Having more than you could afford

You can start using equipment now that you may not have been able to afford had you opted for a straight purchase and a lump cash payment.

Leasing allows you to spread the cost of the equipment over a designated period.

What type of photocopier can be leased?

Digital Office Group offer leases on the entire range of products, from small A4 desktop printers, A3 multi function photocopiers, wide format plotters and digital production presses. Regardless of your specific business requirements, all of our devices are available for you to reap the benefits of leasing them.

Digital Office leasing Partners.

Digital Office work only work with asset finance companies who specialise in photocopier leasing. These include PEAC, Societe Generale, Shire Leasing, GE Capital and Grenke Leasing. The price and financial agreement with your photocopier will totally depend on the specification of the machine you choose.

Leasing a photocopier from Digital Office.

As previously discussed leasing/renting is a seamless way for businesses to save money without compromising on the quality or functionality of their new photocopier. For a large proportion of companies, purchasing a photocopier is a huge expense, with the typical price of a photocopier ranging from £1000-£15,000+.

Whether it be a long or short term lease period, its always much more cost effective to lease rather than purchase. When leasing print equipment from a leading supplier such as Digital Office Group, you don’t just get around the large up front capital expense of the machine, but additional costs relating to service. Our service covers installation, training, photocopier maintenance, engineer support and all consumables for the device.

Managed Print Services with your Lease

Running a Service contract along side your lease will keep your device supported throughout the term. The service costs, commonly know as a “click charge” or “cost per page” mean you only pay for the pages your print. You will then receive a monthly or quarterly invoice that covers your for all parts, engineer support, ink cartridges and other consumables.

Digital Office offer all customers to tie their finance agreements in with their Managed Print Service contract. This means there is only one monthly or quarterly payment that covers both hardware and support costs. This is similar plan to purchasing a car and keeping it serviced throughout the lease. Our service contract means your are covered for all breakdowns, spare parts, engineer labour, toner delivered automatically and IT.

If you currently use laser or inkjet printers with no service contract and you just purchase the consumables when required, we would expect to save you a minimum of 30% with one of our tailored MPS solutions.

Get in touch with one of our Managed Print experts.