The financial benefits of lease and hire agreements for water treatment systems
When you acquire plant and machinery like a water treatment system the biggest decision you will have to make is how to structure the purchase.
Should you buy it outright? Should you lease it? Should you finance it? Your decision will come down to what works best for your cash flow situation.
In December 2020, the Government extended the £1m Annual Investment Allowance (AIA) to December 2021 to aid recovery during the coronavirus pandemic. This means businesses can spend up to £1m on plant and machinery this year with full tax relief in 2021 rather than spread over a number of years, making finance attractive.
Most businesses will want to spread the cost of their plant and machinery. We offer various finance facilities to accommodate this including Lease Purchase Agreement and Hire Agreement. In addition, we offer a capital purchase. Here are the financial benefits to these flexible payment options:
Lease Purchase Agreement
A Lease Purchase Agreement (LPA) is a spread purchase that offers you a route to acquire plant and machinery with low monthly payments.
With an LPA, you pay back the cost of the equipment over a fixed term (usually 3-5 years) in return for lower monthly payments.
The LPA can be designed so you pay off the total balance by the end of your agreement or so you have a final balloon payment. At the end of your LPA, with a balloon you can pay off the remaining balance to transfer ownership or continue with your monthly payments until you own the equipment. This gives you flexibility.
With an LPA, inclusive service and maintenance is a key benefit. We will look after your equipment to ensure optimal flow and performance.
Lease purchase financial features:
· Low monthly payments
· Fixed repayment term
· Clear ownership route
· Lease payments are 100% tax deductible.
Hire Agreement
A Hire Agreement lets you pay to use equipment. For example, you might like to hire a Membrane Bio Reactor (MBR) without buying it.
With a Hire Agreement, you only pay to use the equipment. This lowers your monthly payments because you aren’t paying off the total cost of the equipment to buy it, as with an LPA. This kind of agreement is useful if you intend to upgrade your equipment soon or only need equipment for a short period of time.
As with an LPA, service and maintenance is included with a hire agreement to keep your costs low and your equipment running optimally.
Hire agreement financial features:
· Pay to use
· No ownership route
· Flexibility to hand back
· Opportunity to extend the hire period.
Why Membracon?
Choose Membracon and you get a commitment to assist in bringing the most sustainable water treatment systems to your operation. This stretches from design and supply through to remote monitoring, S&M and cloud-based reporting.
We offer finance solutions so you can operate on an asset light model with fewer capital assets. We allow rental of the newest water treatment systems with maintenance and servicing included. The idea is we put the best water treatment systems into operation in a way that does not overburden you, our customer.
By renting equipment from us you spend little but get all the benefits of the most efficient technology. Our financial packages enable you to scale your operation at reduced cost. This is the most efficient way to upgrade your capabilities.
Take the next steps
Membracon offers a variety of water treatment solutions, including effluent treatment systems, water recycling systems and clean water systems. All systems are available with a financial flexibility package to spread the cost of purchase.
If you want some more advice or would like to request a quote, contact us. The best way to reach us is by phone on (0)1902 458501.