The case for technology finance leasing is simple and powerful.
Clockwork Capital’s solutions let you acquire the equipment you need now and spread the cost over your equipment’s useful life. You can free up working capital and start realising the benefits.
Great for your cashflow
Create instant cashflow benefits by spreading the cost allowing you to acquire the latest equipment.
Total payment flexibility
We create bespoke packages that reflect your annual cash flow, allowing you to structure payments on a monthly, termly, quarterly or even annual basis.
Conserve your capital
Finance from Clockwork Capital enables you to tap into future operating budgets, so you can dedicate your existing cap-ex sources to other projects.
Freedom to make decisions
We’re independent, so you specify the equipment you need from the supplier or suppliers of your choice.
This funding option gives you the cashflow benefits of leasing together with the opportunity to buy the asset outright by paying only the VAT on the cost of the equipment plus a deposit or initial rental payment in advance. At the end of the agreed term you pay a nominal fee to gain title to the equipment.
You will normally be able to claim capital allowances on the equipment with the interest element of the payments being tax deductible. You can choose the term and interest rate structure that best suits your requirements, including the amount of initial deposit you wish to make.
A finance lease transfers substantially all the risks and rewards of ownership of an asset to you, the lessee. Your cashflow will be further eased because unlike Lease Purchase, VAT is payable on the rentals only, not the full purchase cost of the asset.
By paying rentals over a fixed term it enables you to use the asset throughout its useful working life without ultimately owning it. At the end of your lease agreement you can continue to use the asset by simply paying nominal annual rentals or sell it on behalf of the funder and benefit from a proportion of the sale proceeds.
Particularly suited to equipment which you may want to upgrade regularly to ensure that you are using the latest technology, and ideal if you only need an asset for a period of time and do not want to actually purchase it. You can benefit from the use of the asset and rental payments can be tailored to match the income generated by the asset itself, or to suit your cashflow needs.
Operating lease rentals are off-balance sheet and chargeable to your operational budgets so are fully tax deductible against operating profits because in contrast to a finance lease, an operating lease does not transfer substantially all of the risks and rewards of ownership to the lessee.
At the end of the lease you have the option to extend the agreement or simply return the asset, subject to the return conditions, which will remove your responsibility for disposal and give you the opportunity to upgrade to the latest technology.
Sale and Leaseback
With Sale and Leaseback (in effect a Finance Lease) you can immediately free up capital that is tied up in your assets. By selling the assets to the leasing company for an agreed percentage of their net book value and immediately leasing them back you can continue to make full use of the asset while releasing capital to use for other needs within your business.
The lease term is usually determined by the age of the asset at the point it is refinanced and its expected remaining working life and future value. End of term options are as for a Finance Lease.
Why use Asset Finance
In addition to tax savings, it is considered good business practice to use asset finance when acquiring new equipment rather than to tie up valuable working capital.
Arranging asset finance is generally quicker and easier than approaching your bank for a commercial loan or overdraft extension to fund the equipment you need. Banks can take far longer to consider your application and may seek security such as a charge over property or debenture over business assets. With asset finance this is generally not necessary as the equipment financed is the primary security. By using asset finance your banking facilities will remain unaffected giving you more flexibility should you need it in the future.
Clockwork Capital’s advisors will be happy to talk you through the various types of funding options available, and help you decide which best suit your requirements.
Whatever your requirements, if you’re considering any type of finance arrangement to help your organisation acquire essential technical equipment make sure you talk to Clockwork Capital on 020 7287 3132 first.